The Unz Review - Mobile
A Collection of Interesting, Important, and Controversial Perspectives Largely Excluded from the American Mainstream Media
 TeasersiSteve Blog
Why Is the Oil and Gas Industry Less Obsessed with Grinding Down Its Workers' Wages?
🔊 Listen RSS
Email This Page to Someone

 Remember My Information



=>

Bookmark Toggle AllToCAdd to LibraryRemove from Library • BShow CommentNext New CommentNext New ReplyRead More
ReplyAgree/Disagree/Etc. More... This Commenter This Thread Hide Thread Display All Comments
AgreeDisagreeLOLTroll
These buttons register your public Agreement, Disagreement, Troll, or LOL with the selected comment. They are ONLY available to recent, frequent commenters who have saved their Name+Email using the 'Remember My Information' checkbox, and may also ONLY be used once per hour.
Ignore Commenter Follow Commenter
Search Text Case Sensitive  Exact Words  Include Comments
List of Bookmarks

 
Hide 208 CommentsLeave a Comment
Commenters to Ignore...to FollowEndorsed Only
Trim Comments?
    []
  1. Anonym says:

    http://fortune.com/global500/

    Half the biggest 10 companies by revenue in the world are O&G. That is one reason why they pay their staff well. Another reason is that the work can be risky so there may be some danger money involved.

    • Replies: @Anon
    , @Neoconned
  2. Cicerone says:

    Labor costs make a very small share of overall costs in that industry, so it is only natural that they aren‘t that bothered with bringing them down.

    • Replies: @Svigor
  3. “I have a vague impression that the oil and gas industry generally has been less obsessed than many other industries with grinding down its workers’ wages. If that’s is true, I’m not sure why that is.”

    Many of the environments those industries operate in are hazardous and extreme. It’s possible the wages must reflect that in some way.

    I spent 3 days on a retired oil platform off the coast of California in March of 1999, for a training exercise in Marine Corps. It was brutal. Cold and constant high winds. We slept outside. Living on one for weeks or months at a time would certainly be difficult.

    I also looking into driving opportunities (related to fracking) in the Dakotas about 10 years ago. What I found (and I’m not claiming this is comprehensive) was the pay was right around $20 per hour (non union, no overtime) but you could basically work as long as you wanted, running tankers loaded with water back and forth from water source to the job site. IIRC lodging was offered but it was barracks style. In short this deal wasn’t even close to get me to pack up and move (teamster scale was about $10 more per hour at the time) but it must be enticing for quite a few people because drivers are doing it. Repetitive and boring work, no doubt.

    • Replies: @Cleburne
  4. Muse says:

    Industries that have an expense structure where the cost of capital is extremely high relative to labor costs tend to pay more that companies with a lower ratio.

  5. Muse says:

    Companies that have a higher ration of capital costs versus labor costs tend to pay more.

    • Replies: @Muse
  6. Because, it’s The American Way®!

    • Replies: @Anon
  7. One reason is that the industrial construction sector still has a strong union presence, and the owners and constructors tend to maintain good relationships with those unions because their own permanent workforces are usually partly unionized.

    Also, you’re right about oil and gas work often taking place in remote areas. The guys who do the work leave their families for months at a time and rack up big per diems, or live in man camps. The faster you get them in and out the cheaper your construction will be. Union or not you want to boot out the chaff fast and pay the guys who can do the work.

  8. “I have a vague impression that the oil and gas industry generally has been less obsessed than many other industries with grinding down its workers’ wages. If that’s is true, I’m not sure why that is.”

    What percentage of Oil and Gas industry is unionized? If there is significant union representation, that might explain some of it.

    • Replies: @ben tillman
  9. Anon[378] • Disclaimer says:

    According to David Stockman, fracking is only viable as a result of Fed easy money. Maybe they just have money to burn.

  10. It could be a “quality wage” effect (Ackerlof). If workers are using expensive capital equipment which can be damaged by misuse, then managers are willing to over-pay them to encourage them to self-monitor. Workers who are over-paid relative to their employment alternatives are more careful with expensive capital equipment, since the cost of losing their job is higher.

  11. FPD72 says:

    Anyone who has spent much time in the Permian Basin (West Texas and Southeastern New Mexico) understands just how wrong the observation about whites doing all of the manual labor in the oil patch is.

    It’s true that whites still predominate on drilling rigs. But Hispanics, many of whom are illegal aliens, predominate on well servicing rigs and as roustabouts.

    Yes, there are few immigrants to be found working in the oil industry in North Dakota, but there isn’t nearly as much activity there as there was ten years ago, due to declining oil prices. The Permian Basin is still very active; half of the drilling rigs operating in the United States today are in the Permian Basin.

    Another thing to remember: what we think of as “oil companies” aren’t involved much in the blue collar end of things. Drilling, casing, cementing, perforating, fracking, logging, servicing — these are done by oilfield contractors, not exploration and production companies.

    But even E&P companies are getting “browner” under affirmative action and diversity goals coming from the top among the majors. Because of a lack of American blacks with educational backgrounds in Petroleum Engineering, I know of at least one major that is bringing in foreign engineers who come from oil producing nations. This doesn’t seem to be affecting the independents, who are more focused on the bottom line and don’t waste time and money on diversity and inclusion issues.

    TL;DR: there are plenty of immigrants working on well servicing rigs and performing roustabout work on lease sites. Some majors are importing engineers and geologists from foreign countries, not to drive down wages but to meet corporate goals for diversity. When oil prices drop, contractor pay often drops to keeps rigs and hands working, but right now the Permian Basin is still booming.

    • Agree: Twinkie
    • Replies: @Thud
    , @International Jew
  12. As a first order estimate, I would say that because the petro industry is very capital intensive, they don’t need to worry so much at the small share of their costs that is labor. They get better ROI by spending more on the employees to reduce their other costs.

    There is clearly more to it though. The auto industry is notoriously capital intensive, but doesn’t pay as well as oil. My guess is that 1) auto manufacture still involves more line labor than oil drilling per unit production, and 2) auto is more competitive since no particular natural resources are necessary to enter the market and many governments sponsor national champions making the field more crowded. So prices are driven down near to near production costs and firms try to trim every cost they can, including labor, to stay profitable. There is a strong political dimension to the oil biz too, especially internationally. Who gets contracts is often the outcome very high level geopolitics, which makes the business less competitive and means that much of it operates as a de facto state semi-monopoly. This applies less to the US and Canadian fracking and oil sands, which are domestic and undertaken less by oil majors than by specialized firms. So, yeah, there may be an irreducible element that white guys just do better working difficult jobs in cold empty country.

    Obviously, there are other businesses that can pay pretty well, e.g. consulting, but are not capital intensive. Labor is the main cost in consulting, so they have a big incentive to grind down pay and import H1B’s for example. So life in a Manhattan rat warren where rent and overhead devour your salary versus life on the Bakken where there’s nothing to spend money on and you’re not too worried about management importing scabs from India.

    • Agree: Lot
    • Replies: @Lot
  13. One of my friends in grad school was a petroleum engineer before school. He described the manual laborers as “pirates, but on land.”

  14. Anon[419] • Disclaimer says:

    I know nothing about this, but from looking at job sites, it might be the case that you have to be on the ball. For instance, they drill holes in the ground that go very deep, and if there is a screwup and something gets jammed or breaks down there, they often have to start from scratch and lose a lot of money. And they were talking about, for instance, slickline, which is some sort of wire or cable made in lengths measured in miles that is passed down through drilled holes. I’d think risks multiply here. If you screw up the slickline you need to order another six mile roll of the stuff, drill a new hole, and try again.

    So perhaps they want physical, hardworking, don’t-mind-getting-dirty young guys, but the smartest and most conscientious of that cohort, not the average guys or the budget guys. The analogy might be the guys hires at construction or mining sites to operate the building-sized cranes or dump trucks. Or even the tree climber, spike-shoe wearing, “mini chainsaw in a holster” guys that have to remove a giant tree in the middle of a densely packed residential area with houses a few feet left and right. Those guys are mostly white, and need a working knowledge of at least Physics 1: Mechanics. And of course offshore platform guys. How much did British Petroleum end up having to pay in damages for that Gulf leak? Was it billions or trillions? You want the smartest guys who will do the physical labor for those jobs.

    • Replies: @FPD72
  15. countenance says: • Website

    I’ve thought for a long time that the driving force behind the contempt for the energy industry is that it pays red state non-college white men well. It’s equal parts jealousy on the part of college educated individuals not being paid as well, and tribal bigotry that white men are paid enough to form families and procreate.

  16. Hoyos says:

    I work in oil and gas and the biggest reason that I can see is it is on industry that is on the clock. If it’s highly profitable to get out of the ground (and don’t let anybody tell you oil and gas doesn’t have bad years( you need to get it upstream to downstream fast.

    It’s also a “fragile” industry in some regards. A key piece of machinery goes wrong and you could be losing extreme amounts of money every hour it’s not running.

    Finally, real oilfield work is dangerous and unpleasant and few men are really suited for it. Kind of like how some army jobs come with additional hazard pay, jump pay etc. Some of it you really can’t do long term, strong men get broken in the fields all the time.

    So you need to get it out and get it moving with limited labor supply.

  17. IHTG says:

    Isn’t it obviously environmentalist resentment of fossil fuels

  18. Flip says:

    I think the labor cost is a relatively small percentage of total expenses, and the consequences of a screw up can be very expensive, so you want to have well-qualified workers.

  19. Anon[419] • Disclaimer says:

    A “realistic job preview” for the entry level job of “roustabout”:

    Some information from a job site:

    http://frackingjobs.co/entry-level-oil-rig-jobs-via-shalenet/

    Many folks are drawn to looking into employment with the oil and gas industry thanks to advances in fracking, which is creating tens of thousands of new jobs. However, unless you have a CDL, getting your foot in the door of the shale oil and gas industry is difficult, though not impossible. The very fact that the oil and gas industry is growing so quickly within the U.S. (as well as around the world) means that even those without oilfield experience can find ways to get hired into the industry. In fact, along with the current boom in fracking related drilling, there is another huge trend that is opening the door for those who lack oilfield experience. Right now, millions of baby boomers are now retiring from their lucrative careers within the oil and gas industry. The mass retirement of boomers is a trend that is affecting all industries, to be sure, but this trend affects the oil shale business more significantly because it is occurring just as fracking begins to take off.

    So how can someone who is completely new to the oil and gas industry get into the business? We at Fracking Jobs have posted numerous articles on getting oilfield jobs by first getting a commercial driver license. But what if you aren’t interested in getting a CDL or simply want to work directly on an oil rig? Well, one of the most commonly offered entry level oil rig jobs is that of “roustabout”. A roustabout is the “gopher” or “mule” of the oil rig team; the person saddled with the everyday grunt work of the drilling rig. Newbies to the oilfield industry are often hired as roustabouts as the job doesn’t require extensive oil rig experience. However, some introductory training is still necessary for those seeking work as roustabouts. This training is available via private oil and gas training schools, vocational schools, and sometimes directly through an employer. Remember also that working as a roustabout is one way into oilfield work, and can lead to higher paying oil rig jobs as experience accumulates.

    Ok – so you’re interested in seeking entry level oil rig work, and it looks like pursuing a job as a roustabout is the way to go. But you don’t have the funds available for private school training, you don’t live near a vocational school that offers oilfield training, and you’ve been told that the companies that are drilling in the areas where you seek employment won’t offer training to new hires. What to do? One solution is the private/public partnership which started in Pennsylvania known as “ShaleNET”

    I get the feeling that the shift work aspect, 14 day on, 14 days off, 12 hours a day, overtime required nature makes it like working in a firehouse. There is a small group that is in each other’s faces for long periods of time. I would imagine that the more cultural, social homogeneity the better, from a mental health standpoint. NASA doesn’t hire people to send to the space station without making sure that they will get along with each other. Oil jobs seem similar to a mission to Mars.

    • Replies: @Joe Schmoe
  20. The energy industry is also leagues more dangerous, personally and environmentally, where mistakes are extremely costly, and also very high profile. Free riders and diversity hires would be less welcome because of that.

  21. Stick says:

    You have to pay more for people to live in less than comfortable surroundings. I would imagine with the roaring economy that fracking crews will be paid even more to compensate for long days, harsh weather in remote locations with little comforts. Never lived in a trailer during a North Dakota winter but I suspect it is not that great.

  22. anon[393] • Disclaimer says:

    well its very hard work in terrible conditions that requires intelligence so most sub and urban whites, and minorities are disqualified, they have to draw from flyover country where higher average white cognition is not siphoned off to get a university pozzing.Its the type of work that cant easily be taught beyond the basics, shit happens and you need to be able to react instantly with intelligence and bravery. you need to draw on a life of that type of work thats similar that type of work only happens in flyover country anymore. muds are just too dumb and too small too lazy and too timid.They have to pay enough that these men will leave their families and towns and work months on the road these are men who have eschewed leaving their families and towns for university already because they value family and community, it is also very expensive to work on the road, these men drive mostly pickup truck that burn lots of fuel the distances are far and often change and road meals and lodging are expensive you have to make it worth while these are men who are from a lot of self employment backgrounds like farming ranching trucking contracting etc they are used to thinking about net and what ones time is worth so they dont fall for scams where they end up losing money but they are resigned to the fact they wont get rich either.

    heavy construction is being destroyed by mexican and black incompetence, we now have to idiot kit and dumb down and hire five muds where we once needed one white guy, so wages being pushed down helps the that.But its still a shit show

  23. Aslangeo says:

    I am a petroleum geologist. The oil industry is less obsessed with wage costs relative to other industries because wage costs in oil companies only account for 3 to 5% of turnover, compared to 30 to 40% in most other industries or 50 to 70% in investment banks, major league professional sports clubs or the government sector. Having said that the oilfield depression from 2014 has led to over a million job losses worldwide.
    Working on oil rigs be they in North Dakota, Siberia or the North Sea is a tough job. Rig workers typically work on a two weeks on two week off cycle, where a worker would do 14 twelve hour shifts followed by two weeks vacation. Some areas work on a month on month off basis. This is not a lifestyle which suits most people.
    In terms of ethnicity we are a truly multi national industry employing and deploying people from all over the world, which can occasionally lead to amusing results, like when a vegetarian Indian friend went to Argentina. The intellectual, physical and teamwork demands are high so we tend not to recruit too many dummies. In the US we do recruit many men with no college degree and are particularly keen on ex military veterans. These folks have very strong skills and attitudes

    • Replies: @Ed
  24. HI says:

    Two differences from agriculture and (to a lesser extent) construction: level of skill, and cyclicality. The oil and gas industry is notoriously cyclical and conducts mass layoffs of skilled labor in downturns. When prices were low in the 80s, a good chunk of the oil industry employees permanently left the field. These were mostly skilled people, including professionals. People learn. If you’re viewed as a temporary employer, you’ll need to pay a premium to get skilled workers during good times.

    • Agree: donut
  25. Jliw says:

    I’m not sure how true the Tweet by Sid is. Well, it’s probably true in North Dakota, but the amazing boom in Texas (and associated work in Colorado and NM) is chock-full of Mexicans. I work in the oilfield out here in West Texas and while it’s less purely Mexican than other such work, it’s still maybe 50-50 white/Mexican to my perception.

    Not a lot of blacks, though — hardly any, and those you do see tend to be Nigerian immigrants.

    It’s certainly true that the wages are fantastic, though. I worked as a chemist for a small environmental lab before this; “downgrading” to what is essentially manual labor has tripled my income. I drive the car I dreamed about when I was doing the career I was “supposed” to go into. It’s fantastic, although it also leaves about 0 energy and free time outside of work — but I still love it.

  26. Anon[419] • Disclaimer says:

    OT

    A demographic explaination from Whiteshift about why third world population is going bonkers in a way that didn’t happen in Europe: The revolutions in industry, sanitation, and medicine happened over a 200 year period in Europe, so the transition from big families with lots of children dying and women dying before having children to smaller families with high rates of survival played out gradually.

    But in today’s third world countries it happens very fast, so in a few generations you go from half a dozen or so children, many of whom die, to half a dozen who live. Social customs don’t change so quickly.

    An example: Denmark went from 1 million in 1775 to 5 million in the 1950s. Guatemala went from 1 million in 1900 to 15 million by 1990. This happened all over, so after the 1950s the relative population of the West dropped precipitously.

    • Replies: @Lot
  27. Two possibilities:

    1. The jobs are often in far-off, undesirable locations. I don’t just mean West Texas and North Dakota- I mean offshore oil rigs and walled compounds in Sub-Saharan Africa (I have relatives in the oil industry who’ve spent extended periods in both of these).

    2. The boom-bust nature of the business means that when they want workers, they really want them. So they have to pay what it takes. Then later they’re laying people off.

  28. I met the president of BP America a few years back.

    White male. Went to Washington State University, I believed. He had an engineering degree and had worked his way up from a rig engineer to president. Great guy.

    Rex Tillerson seems to have followed the same trajectory, starting off as an engineer at ExxonMobil (undergrad degree from UT Austin) and then working his way up.

    My guess is that these guys don’t care to cut their workers’ wages because they used to be those workers themselves and either come from the same background or have interacted heavily with the blue collar crowd when they were younger and so have a harder time being so savage about cutting wages.

    Compare that to many companies today that are run by elites (Facebook, Google) and/or by MBAs who often care far more about cutting costs at any means necessary than their workers’ pay.

    It’s something I’ve seen consistently – companies run by oldskool type engineers (especially from state schools) don’t tend to depress wages.

  29. I’m more familiar with offshore oil exploration, rather than the more recent fracking boom. But yes, oil companies don’t even try to get foreign labor or to really cut employment costs to work offshore rigs in the Gulf of Mexico or for the onshore workforce that supports offshore oil.

    They apparently see it as worthwhile to invest in their workforce. For probably related reasons, the big oil companies are fanatical drug testers.

    I think it has to do with the technology/ infrastructure being insanely expensive while labor costs are relatively low. In other words, you don’t save much by cutting labor costs. Also, they really depend on the guys working on the rigs. A relatively small number of men are operating complex and very expensive equipment without a lot of supervision, relatively speaking. If something goes wrong (like Deepwater Horizon), it can cost billions.

  30. Paul Rise says:

    My very limited experience with the petroleum industry was as a salesperson who sold high end goods in a community where there was a lot of petroleum money and jobs.

    My feeling was the industry is always swimming in profit and they use contractors whenever they can.

  31. JSM says:

    I have a vague impression that the oil and gas industry generally has been less obsessed than many other industries with grinding down its workers’ wages. If that’s is true, I’m not sure why that is.

    Safety.

    Drilling is dangerous…and an accident where a guy gets killed on a rig is MOOEY expensive. Millions to pay out for the lawsuit award.

    Because White men are on average smarter than mestizoes, they work safer, because they comprehend the dangers. Therefore fewer accidents, therefore fewer lawsuits, therefore more profit, despite the high wages.

  32. Off topic:

    Steve

    Actress Bebe Neuwirth’s father Lee Neuwirth….Knot Theory-Three Manifolfs specialist at…was at…..the Princeton University Math Department and a cryptography researcher at the US Defense Department funded The Institute for Defense Analysis in Princeton NJ…….wrote an interesting book:NOTHING PERSONAL -THE VIETNAM WAR IN PRINCETON 1965-1975……

    Interesting for two reasons:

    1)There was a time when Liberal American US College Students protested US-CORPORATE OLIGARCH Wars of Aggression…

    2)Lee Neuwirth’s colleague at the IDA in Princeton was Leonard Baum who created a modified version of the Hidden Markov Chain Model…….Leonard Baum was a close friend of James Simons….Rennaissance Technologies…..Simons hired Leonard Baum in 1977 to work in-a-hole-in-the-wall-office across the street from Stony Brook Train Station to use this modified version of the Hidden Markov Chain Algorithm to short the dollar and the pesos….the rest is history(most of this part of the story comes from Paul Wilmont’s(Wilmont Forum) book….and this history includes Liz Simons’ using her father’s billions to import all of Central America’s Population into California….almost an exact quote of what Liz Simons’ said in an interview in a Jewish online magazine…

    So there you have it…..the MASTER ALGORITHM that gave James Simons his billions and billions…was created at a US Defense Department Think Tank funded by the Working Class Native Born White American Majority in the 1960s played an absolutely crucial role..and it still does(think Hidden Markov Chain Expert Robert Mercer) in James Simons acquiring his billions which his daughter uses to force post-1965 race-replacement Immigration Policy on the Working Class Native Born White American Historic Majority….who funded Leonard Baum’s Hidden Markov Chain Model Research at IDA Princeton which enabled Simons to his acquire his billions………..So this is how “Free Market Capitalism” works……Nicholas Taleb is very much enamoured of this thing called “RUGGED SKIN IN THE GAME FREE MARKET CAPITALISM”…

  33. Because White Privilege, of course.

  34. Andy says:

    more demand than supply? Oil work is complicated and requires a lot of training (you can’t pick a random guy/gal in the street for this) and not every worker wants to move to North Dakota. That tends to keep wages high.

  35. Obviously, iSteve is calling for a new branch in the science of Grievance Studies. Call it “Fracking Exclusion” perhaps? Complete with a surtax on (white) workers’ wages to be redistributed to POC who find the weather, and workload, oppressive.

    • Replies: @Redneck farmer
  36. bjdubbs says:

    Most of the labor is hired by the service providers, not by the E&P companies, and the service providers operate on cost plus pricing and reducing labor costs wouldn’t increase profits. In that sense oil and gas industry is a lot like the defense industry, another high wage industry.

  37. Mr. Anon says:
    @countenance

    I think you’re on to something there.

  38. But the Democrats’ immigrant voters don’t want to live in cold, empty states. They aren’t pioneers. Despite all the schmaltzy propaganda about USA being a Nation of Immigrants, modern immigrants aren’t nation-building pioneers.

    Exactly.

    • Replies: @Abelard Lindsey
    , @anon
  39. Mr. Anon says:

    Are oil and gas executives more likely to have come up through the ranks? More likely to have been tradesmen themselves? Or more likely to have been engineers who have actually worked alongside welders, machinists, pipe-fitters, etc.?

  40. @countenance

    Yes. And this industry is, in its basic iconography, traditionally 19th C-early 20th C “white”. It is, never mind Arabs, imagologically hard-hat & wayciss. Nothing post-modern about it.

  41. Jack D says:

    Labor is an insignificant cost in oil production as a % of the value of the product, so saving a few pennies hardly makes a difference to the bottom line. The Deepwater Horizon cost BP $1,000,000 PER DAY to operate. So if you spend another $50,000 on labor by hiring the most competent, experienced people available (grizzled old white guys) and paying them an extra $10/hr and the well gets finished a week sooner, it is well, well worth it – it’s not even close. The crew also has the potential to cause tremendous damage ($60 billion worth) so again you want the best that $ can buy. This ain’t the chicken plant.

  42. Mexican women also seem to specialize in service jobs like housekeeping in the hospitality industry, which exists mainly in developed economies after the legacy population worked, saved and built up the capital to make the modern world possible. You have to hand it to these peasant broads from Latin America: They show a strong work ethic in helping to maintain a system their people couldn’t have built on their own.

  43. TG says:

    There is the Nobel-Prizewinning concept of “efficiency wages,” that goes: it is more costly to fire an airline pilot when they have flown halfway to their destination, than to fire a janitor when they have only mopped half a floor. It is more costly to have a pissed-off janitor throw their bucket on the ground, than for a pissed-off petrochemical engineer forget to set a valve and a billion-dollar plant blows up. (Hey, this Nobel Prize thing is easy!).

    And yes, labor is s trivial part of the petrochemical business. It’s why even in cheap-labor Mexico, the petrochemical workers are about the only well paid workers in the entire economy.

    • Replies: @Joe Schmoe
  44. @Jack D

    The chisling chicken companies in Arkansas have also brought in Marshall Islanders to work in their plants, in addition to all the Mexicans. My grandmother worked in one of those plants back in the 1970’s, but Arkansas must have run out of hillbillies or something. The Marshallese make my Ozarks kinfolk look like graduates from Starfleet Academy.

  45. Roughnecks have far less room for error than, for example, someone monitoring a conveyor belt in a factory. I would guess it’s about attracting and retaining skilled labor.

  46. Living in a non-fracking part of a state with fracking and having been to the fracking region I think touting the high wages may have something to do with convincing State legislatures and regulators to permit the activity in the first place even if the labor supply is going to be “wildcatters” from elsewhere.

  47. AndrewR says:

    I lost brain cells reading “Sid’s” tweet.

  48. Corn says:

    I remember Steve referenced an article 3-5 years ago that was printed in the NYT or some other big city newspaper.

    The demand for laborers was so high (presumably because everyone was getting work in the oil industry) that gas station cashiers were being paid $20 per hour in some North Dakota towns.

    Lefties like to pose as the champions of higher pay for workers but these wages were being paid to those lily white and often Republican voting North Dakotans. So of course the NYT article warned everyone that these high wages would be terrible, utterly terrible in the long run.

  49. The consequences of error are higher in oil and gas than in farming or construction.

    Juan can hang a window crooked or drop a load of walnuts and it isn’t the end of the world, but you don’t want him messing around a pipeline or refinery. The white guys who work in these places especially don’t want him there, since they’re ones who’d get cooked if he made a mistake.

    It’s worth paying a little more for extra competence.

    • Agree: Cleburne
  50. It’s difficult, dangerous work, usually done outside in the cold. Of course it’s snow people. And I know for a fact that a major wage driver is a shortage of workers who can pass a drug test. It’s not fentanyl here, it’s meth.

  51. Eddie says:

    I think you can’t discount the location premium.

    Working on an auto assembly line means putting in your 8 hours, punching out and driving home to your family. Working in oil and gas very often means going to places where families can’t or won’t live and off duty recreation options consist of either Netflix or the one or two local bars, which are devoid of women.

    Much like long-haul trucking discussed last week, working the oilfields is not really so much a job as it is a lifestyle commitment.

  52. Lugash says:

    It’s a cyclical industry. You’ve got to offer something more for a truck driver or welder to pick up and move to BFE when they know they’re going to get canned in a couple of years. The cost of living in these areas isn’t always cheap either.

    • Replies: @Buffalo Joe
    , @McFly
  53. Anonymous[410] • Disclaimer says:

    NY Times writers instinctively not liking flyover non-college whites making a good wage – possible. The rest though, simply not true.

    First of all immigrants seem to have no problem going to cold and (relatively) empty places. Small cities and towns in MN and WI have plenty of Somalis and Hmongs. Moving even farther North, Winnipeg has one of the harshest winters on Earth but is now 10% Philippinos and plenty of Salvadorians, Ethiopians, etc. Towns across the Canadian Prairies have more Sikhs than you would know what to do with, and the NY Times repeatedly crows about how Hispanics are repopulating dead agricultural towns across KS and NB.

    What makes oil and especially gas different is that the infrastructure is immature and often temporary, so the labor costs are small compared to the capital and other costs. Because wells dry up, prices fluctuate, and regulatory structures change, extraction companies need workers who can go out at short notice, work long shifts, and get the job done. There simply isn’t time to sponsor H1-Bs or deal with teams of non-English speakers.

    In longer-established oil and gas regions, like Northern Alberta, contracting companies and ancillary services often do eventually turn to immigrant workers and put downward pressure on wages. These areas are surprisingly diverse for being essentially sub-arctic.

  54. @Jack D

    This. Also, entry machining and welding jobs need certifications, quite unlike building houses. Most immigrants don’t have those certifications even if they have learned those skills abroad, although I would guess that a few east European guys have gone through the trouble of obtaining the equivalent of US journeyman’s papers.

  55. Anonymous[151] • Disclaimer says:

    Oil and gas in the Permian Basin is heavily if not predominantly Hispanic. And these days the real action is down in Odessa, not North Dakota.

  56. Anon7 says:

    Let’s drill down to the real problem:

    Geography, of course, plays a uniquely significant role in the oil and gas industry – and, by extension, who the industry hires. Today’s energy boom – the one that’s allowed the U.S. to become the world’s biggest exporter of oil and gas and, soon, to export more crude oil than it imports for the first time since 1953 – is tied to a series of shale rock formations spread beneath the U.S.

    There are the Bakken Shale in western North Dakota, the Anadarko Basin in Oklahoma and the Permian Basin in West Texas, for example, each embodying the popular image of the U.S. energy renaissance: a boom based in rural communities along the central spine of America, areas that also happen to be bracingly isolated and overwhelmingly white.

    Such locations pose a challenge when it comes to coaxing most any young American to the oil and gas trade. But they present particular issues in recruiting black workers.

    “It’s not uncommon in a lot of these areas to see people with Confederate flags and things of that nature,” says Tosa Nehikhuere, a well engineer who worked on oil wells in Fort Worth, Texas, during internships as an engineering student at the University of Texas at Austin. “For a black person working in that environment, a lot of times it can be very uncomfortable because they obviously don’t fit in with that culture.”

    Oil Boom a Bust for Blacks

    Too many white people sitting on the More Magic magic dirt.

    Dempsey says executives already embrace diversity. The focus these days is on middle managers where the hiring and firing happens.

    But he says there are other things about the oil industry that are difficult to change, like where the oil or gas is located. Dempsey says it’s often in remote places, “versus the urban centers where minorities — communities of color — tend to be and, frankly, where people from those communities tend to want to live and to work.”

    Dempsey says the industry needs to do more to make rural places welcoming to women and minorities.

    Rod Hinton knows about this issue. He is an African-American attorney who moved to eastern Ohio a decade back to work in the oil business.

    “Here you got to live in the white man’s world. It’s pickup trucks and Confederate flags, Trump signs everywhere … That’ll turn a lot of minorities off,” says Hinton.

    Big Oil Has A Diversity Problem

    Who wants to live in the white man’s world?

  57. @Lugash

    Lug, Same with the “boomers” that follow the big construction projects, such as power plants and major bridges. You can work in another local union but you pay them a fee. Few major construction companies pay expenses to anyone other than their supervision. Even with out of pocket expenses a four or five year ride at a major project is a life changer for most tradesmen. The company pays union scale, which is high, but they get a trained, skilled workforce. Union welders are topnotch and usually “certified”, although you test again at each project.

  58. BB753 says:

    I blame a lack of “wokeness” and diversity. They need more surly female Black HR in their staff who’ll put privileged white blue collar workers in their place.

  59. If an oil industry worker screws up it is very expensive. The BP Horizon, Exxon Valdez, BP Houston Refinery blow up, &c were billions. All human errors. To minimize these human errors requires the smartest best trained humans. These cost money.

    ALL ACCIDENTS ARE PREVENTABLE

  60. McFly says:
    @Lugash

    Yep, there are a lot of short-term projects that require people to move.

  61. Anon[159] • Disclaimer says:

    You have to qualify and pay for a state license as an electrician so you have time and expense there. So you’re looking at 30 plus classroom hours and paying for and taking an exam and the yearly fees. Plus you are away from your family for the most part. And like was stated above the landlords jack up the rents esp in smaller areas. If you are from a high wage area such as I am you are going to be working for less per hour wages so need the ot in order to justify traveling. Need the Saturday to break even; the Sunday and 10 hrs to make it worthwhile for all the expenses.

  62. Roughnecking is highly seasonal, unreliable, unsteady work—kind of like commercial fishing. It’s a business of windfalls, a series of bonanzas and busts. When you average the wages over the long term, and then take into account the financial uncertainty, the travel and risks involved, the time away from family, and the opportunity costs, I don’t think the claim of generous compensation would hold up.

    The oil and gas industry is also hugely financialized. Without the backing of national governments (mentioned by ≈MO) and the complicated derivative structure that governs the global marketplace, there would be no entity in the world capable of bearing the risks involved with this massive and irregular project. For example, it has taken roughly $4 trillion worth of exploration over the last decade simply to maintain the current output. Who has that kind of capital just laying around?

    The net result of all this is that the consumer ends up paying a premium, not for oil per se, but for the reliability of oil. The cost is highly socialized, distributed across the price of every other good and service, and hedged by a global derivatives market of staggering scale. This creates numerous opportunities for those in the loop to cream personal profits out of the system, but the industry as a whole is deeply indebted and probably now operating at a loss (the American frackers certainly are).

    This is one of the reasons why the world is slowly and by imperceptible degrees going broke. This is why working class wages in the aggregate have been flat to declining for nearly four decades now. We can no longer afford our addiction to increasingly scarce and difficult to obtain petroleum. And since petroleum is a universal energy input the cost of which is incorporated into everything else that is produced, this shows up as a general decrease in purchasing power. The fracking boom itself was propelled by one of the most heavy-handed schemes of financial repression ever attempted. In a world of normalized interest rates and manageable debt levels, fracked oil would be $200/bbl. We have made up the difference only by subsidizing it out of our declining standard of living.

  63. @Jack D

    The crew also has the potential to cause tremendous damage ($60 billion worth) so again you want the best that $ can buy. This ain’t the chicken plant.

    Bingo. Offshore is obviously the extreme case, but makes the point. Success here is getting your science right, not overpaying on the lease, drilling in the right spots. That done, what you want most is competent execution–not screwing up. Not just a matter of IQ, but of conscientiousness and experience. Which is why experienced guys with a good track record can really rake it in when there’s a boom–supply and demand.

    • Agree: Federalist
  64. Some White baby boomer comic — about 30 years ago — used to joke about taking Mexico’s oil by slant drilling.

    This comic used to smash watermelons and other objects with a chunk of wood with a shovel or ax handle sticking out of it, so take that into account.

    Central Banker Shysterism has allowed the oil and gas industry to fund projects on a massive scale.

    The monetary extremism and cheap money and low interest rates has provided the oil and gas industry with a financial atmosphere conducive to capital intensive projects.

    The oil and gas industry is doing everything possible to reduce labor costs and workers by automating the drilling and extraction of oil and gas wells.

    Fracking on a scale seen now was made possible by financialization and monetary extremism.

  65. Anon[159] • Disclaimer says:

    Not just another pretty face . Have BS in Adult Ed so I can train others but also have MBA for critical thinking and a Master electrician license. So the stereotype of a blue collar worker is changing. I am highly skilled and have alot of credentials so I can hold my own against anyone; white collar, blue collar.

  66. @Jack D

    Same thing in the fracking business. Time is money, and much of the work is 6 or 7 days a week. The problem they have is getting locals who can pass a drug test. You can get a certification at the local community college in a year that will let you start at $60k, but some of them can’t seem to let go of the bong long enough to do that.

  67. Why Is the Oil and Gas Industry Less Obsessed with Grinding Down Its Workers’ Wages?

    They’ll get around to it.

  68. Lot says:
    @Almost Missouri

    I was going to post the same thing. It is very much a question of how capital intensive an industry is.

    A few other examples of capital intensive high blue collar wages: port work, railroads, heavy equipment manufacturing.

  69. According to census figures, North Dakota has gotten a lot more racially diverse since the fracking boom began. The black population has gone way up, though I’m not sure how much of it is domestic economic migration and how much is Lutheran charities bringing in Somalis. It is one of those states where black women have a very high birth-rate, which suggests the latter. But the change is so dramatic that they are probably getting it from both ends. For instance, Williams county (the center of the fracking industry) was .3% black and 1.9% Hispanic in 2010. Overall population numbers are not available for 2017, but among children, 3.6% were black and 8.7% Hispanic.

    I’m sure it is mostly white guys who go to work in the oil and gas industry, but North Dakota was a (very small) 90% white state in a 60% white country so internal migration will tend to diversify the population regardless.

    • Replies: @ben tillman
  70. @Buzz Mohawk

    Actually, I have discovered one group of recent immigrants that are pioneers. Many of the staff, from engineers and purchaing people down to factory workers in the seafood processing industry in Dutch Harbor, Alaska, are Filipinos. I’m currently doing a quote for a control system upgrade for one of them.

    Dutch Harbor is one of the more remote places in Alaska, if not the world. it does not get as cold as the Dakotas (the Aleutian Island chain is relatively warm in the winter). But it’s 3 hours by turboprop from Anchorage which, in turn, is 3-6 hours flight time from the lower 48.

    Dutch Harbor resembles some of the planets in the “Aliens” movie franchise. So, I think its fair to say anyone who is willing to live and work there full-time qualifies as a “pioneer” by any meaningful sense.

    • Replies: @Buzz Mohawk
    , @ben tillman
  71. Anonymous[416] • Disclaimer says:

    This is an interesting question. The guys in hardhats aren’t symbol manipulators (no bachelor’s required) but not necessarily factory floor slobs either. At a steel plant you don’t need IQ, everything’s done in groups with lots redundant (Union mandated) oversight. At the same time oil/gas rewards individual cleverness, which is useful to being an electrician or a plumber or drywall hanger or any heavy-craft job, so the dead weight slobs don’t accumulate because it attracts more go-getters who would benefit from a solid technical apparatus in the company (advanced degree grads) backing them up. At the same, same time it puts scant emphasis on feminine workplace socializing skills so maybe ornery high-T dropouts like it. I dunno, may have mixed it up with “Five Easy Pieces”

  72. Way more fundamental point:

    There is no economic case for race-replacing….street by street…town by town….county by county….state by state…..The Working Class Historic Native Born White American Majority with Chinese Legal Immigrants and Hindus Legal Immigrants and their US born Geneline……

    Will the Chinese in Orange County California ever make an economic case to have themselves race-replaced in California by a new wave of European Immigrants?

  73. V says:

    It’s not profitable because petroleum is much more ‘huge projects where everything has to go right’ than, say, agriculture or restaurants or so on. One bad stoop laborer is probably just slow, or ruins one crate of produce, or so on; someone who rivets something incorrectly wrecks a rig and millions or billions of dollars. So it’s worth upping labor costs to drop catastrophe costs.

  74. istevefan says:

    OT – Matt Yglesias openly calling for demographic change to flip a few sparsely, populated GOP states to flip the Senate. We are being colonized from both within and without as they import foreigners and transport liberal whites to more strategic locations. The responses to his tweet are telling.

    • Replies: @Paleo Liberal
    , @Anon
  75. Just came from our acerage and every single lease operator was Mexican and on the drilling rig a quarter of the hands were Mexican although the pusher and driller and DD and all the top dogs were white. The frac site hands are almost all white. And the white collar jobs (engineers and geos) are all white or south American conquistador-americans as Steve calls them. Just FYI.

  76. Very off topic, but…

    Ding, dong, the witch is dead.

    Well, discomfitted, anyway.

    ‘Jill Abramson: Ex-New York Times editor accused of plagiarism’

    That gives my morning a little boost.

  77. Bill P says:

    It’s hazardous work where mistakes can cost a great deal in terms of environmental damage and human lives. By keeping the pay high you can attract quality workers who will not make many mistakes. When something like a refinery explosion occurs because someone didn’t open the right valve it ends up costing a whole hell of a lot more than you’d save by paying low wages.

  78. istevefan says:
    @Jack D

    Here is a listing of current oil prices. Notice the variability in the pricing. Louisiana Light is currently around $61/barrel while West Texas Intermediate is about $52/barrel.

    I understand oil prices vary on the sulfur content. But perhaps the oil in North Dakota is a more valuable type. I don’t know. If anyone has info on this please expand.

    This could be a reason why some oil companies can pay higher wages.

    • Replies: @Jack D
    , @Cleburne
  79. Ibound1 says:
    @Jack D

    We should start with using Somalis for the workers. And yes, it is perfectly fine for everything to come to a full stop so the crew can pray on the rig 5 times a day for 1/2 an hour each time. That’s nothing. Because if I was on that rig, I would be praying ALL the time.

  80. OT – Matt Yglesias openly calling for demographic change to flip a few sparsely, populated GOP states to flip the Senate. We are being colonized from both within and without as they import foreigners and transport liberal whites to more strategic locations. The responses to his tweet are telling.

    President Trump wants to massively increase the number of legal immigrants flooding into the United States.

    Matt Yglesias and Donald Trump want to keep the mass immigration floodgates open forever.

    Trump wants to dramatically increase the number of guest workers flooding into the USA.

    Trump wants to massively increase the number of foreigners flooding into the USA using the various visa scams that have developed over the last 50 years or so.

    Trump and Jared Kushner want to continue to use mass legal immigration as a demographic weapon to attack and destroy the European Christian ancestral core of the USA.

    I am presently mulling over whether to challenge Trump in the 2020 GOP presidential primary. The Pewitt campaign would bring the ideas and worldview of Sam Francis to the town halls and the media.

    I hereby challenge Trump to a debate on mass legal immigration, illegal immigration and American national identity.

    • Replies: @Anonym
  81. And in answer to Steve’s point, from what I’ve seen the professional side of O&G is remarkably hereditary. Almost ever geo or engineer or landman has an extensive family web of other oil men and women. So when these guys get to the top maybe they don’t feel as motivated to slash wages for reasons vaguely related to that.

    Also if you slash a guys pay, there is a good chance he walks to another company with a bunch of very important trade secrets (completions design for engs or exploration targets for geos) that are almost impossible to prosecute for if he violates an NDA, since there is plenty of by design opacity in the business.

    And I always figured lefties hated the oil guys partially because roughnecks are such huge well paid dudes. I’m 5’11” 150 lb and I look like a jockey next to the average floor hand. That, and the fact I still have all my fingers, means all the roughnecks can instantly peg me as a company geo when you I’m on site. I could see the average soiboi with no sense of humor being pretty resentful of those guys.

  82. The pay isn’t all that high.

    The work is extremely dangerous.

    The work is contingent.

    Just goes to show how ground down we all are when we think working on a oil rig is some kind of paradise.

    • Replies: @WJ
  83. Mexicans like to take their culture and their families with them. The oil fields of North Dakota are not a good fit.
    Same with Prudhoe Bay or offshore oil platforms. Six weeks on six weeks off. Great money, no Mexicans.

  84. @istevefan

    I have thought about that myself, but I am not in a position of power.

    What I would like to see would be

    A. Companies allow far more programmers and others who could work remotely to work remotely. This benefits the software companies because they can expand their reach out of the major metro areas

    B. Groups of programmers congregate in decaying cities in “swing” states. For example, suppose a number of programmers working remotely decided to move to Janesville, Wisconsin. Janesville was devastated by plant closings. I’ve seen grass growing in parking lots of ginormous factories, I am very sad to say. If a large group of programmers moved in working remotely, they could boost the economy.
    There is plenty of night life in nearby Rockford Illinois as well as Madison, Wisconsin and even Milwaukee, but with more young professionals in town the nightlife would pick up soon enough.

    C. Eventually companies would see there were pockets of talented and experienced programmers there and open up some offices.

    In very close elections these new voters might swing the election

    • Replies: @Redneck farmer
    , @Romanian
  85. @countenance

    There is similar dynamic at play I think in Australia regarding coal miners, they apparently make well north of $100K per year with no need for college. There were a bunch of articles a few years back with obviously highly indebted journalists lamenting the fact that these working class blokes were making out like bandits.

  86. @Paleo Liberal

    I read comments about moving out of high cost areas for programming. Several people said that the problem is venture capitalists. Basically, they don’t want to drive more than half a day to check projects, so tech gets concentrated around SF, Redmond, Austin, Boston, NYC, and DC.

  87. @countenance

    It’s equal parts jealousy on the part of college educated individuals not being paid as well, and tribal bigotry that white men are paid enough to form families and procreate….

    …and otherwise live out lives consisting of something other than toil and despair. They hate us, and don’t want us to have anything but misery, and a soon-to-filled grave. When someone wants to achieve political power with the explicit goal of maximizing the suffering of you and yours, it’s really important not to let them.

    • Agree: anarchyst
  88. anon[279] • Disclaimer says:
    @Buzz Mohawk

    1000 times yes. Seem to recall somebody (Sailer? Z-man? One of their commenters?) made the distinction between SETTLERS and “immigrants”.

    For most of our history we were a nation of settlers. Building a new land. The distinction is important (so don’t expect anyone to consider the ramifications).

    What we are left with today is the world’s job fair and world’s almshouse.

    • Replies: @Charles Pewitt
  89. @Unladen Swallow

    The Australian coal miners can thank monetary extremism and smash and grab Cheap Labor China globalization for their loot.

    Remember, greedy globalizer rats in the GOP and the Democrat Party use Cheap Labor China to lower wages in the USA while increasing profits for transnational corporations. The share of corporate profits going to labor is at a historic low thanks to globalization and financialization and mass legal immigration and illegal immigration.

    If globalization was just a smash and grab play for a few decades of profit from Cheap Labor in China and Cheap Money to keep the scam going, then what is going to happen when the young people in China and other nations refuse to keep paying all the debts?

    The Australia as resource cartel stuff is frigging fascinating.

    Trump went along with Australia and allowed Third Worlders that were under the jurisdiction of Australia to pour into the United States. Trump did everything he could to bring Third Worlders that were a problem for Australia to the USA, so they could become our problem.

    DEBT AND DEMOGRAPHY

    Monetary Extremism and Mass Legal Immigration

  90. Jack D says:
    @istevefan

    Bakken crude is a light sweet crude of slightly above average quality with slightly below average sulfur. However it currently sells at a discount of up to $20/bbl from WTI because there’s no good way to get it out of the field due to lack of pipeline capacity. The break even on Parshall oil is around $38/bbl so a $20 discount below WTI puts it below break even.

    AFAIK, oil industry wages are above average almost everywhere, but especially in isolated areas where there is not a skilled local labor pool. You have to pay a premium to attract people from outside the area and the more isolated the location the bigger the premium that is needed to attract the necessary labor pool. The oil operators are not charities so if they are paying high wages it is only because they are necessary to attract the needed supply of labor with the required skill sets. If OTOH your local Wal-Mart is paying $10/hr for illegal aliens with phony papers to mop the floor, it’s because that’s all that they need to pay to attract a sufficient # of floor moppers.

  91. @anon

    1000 times yes. Seem to recall somebody (Sailer? Z-man? One of their commenters?) made the distinction between SETTLERS and “immigrants”.

    ———————————————————————

    It was the British Protestants, primarily English, who settled and founded the USA. The Swedes, Dutch, French and other Europeans were here as well, but the English created the United States of America.

    Trump doesn’t have any English ancestry. Trump’s ancestors immigrated to a nation that was colonized, settled, pioneered and conquered by the English.

    Trump is pushing mass legal immigration to attack and destroy the European Christian ancestral core of the USA.

    Tweet from 2014:

  92. Anon[347] • Disclaimer says:
    @istevefan

    Heritage America needs a rogue billionaire to sponsor a more thorough polar bear hunting of Matt than last time’s half measure.

    I’d even be ok with bringing in some Hondurans on H1-Bs to do the job. They could live with their chain-migrated relatives in Matt’s house as payment.

    • Agree: Redneck farmer
  93. mungerite says:

    OT: https://www.nytimes.com/2019/02/06/arts/music/21-savage-ice-atlanta-rapper.html

    Is 21 Savage American? By any measurement other than citizenship, yes.

    That 21 Savage is in fact a British national is, ultimately, not particularly revelatory, or even meaningful. Foreign-born residents made up 13.7 percent of the United States population in 2017, according to the Census Bureau’s American Community Survey, published last year (which includes those in the country legally and illegally).

    His success, however, is especially American. Growing up in some of Atlanta’s poorest communities, 21 Savage had a troubled childhood. He’s said that he dropped out of school to sell drugs, and has spoken in interviews of a youth marked by violence and crime. But after losing a close friend and a brother to gun violence, he turned to rapping. [indeed, definitely the sort of American we need more of!]

    He has also been maturing in the public eye … even walking alongside then-girlfriend Amber Rose in 2017 at her SlutWalk, a women’s empowerment event, carrying a sign that read “I’m a Hoe Too.”

  94. Taysse says:

    Up here in Canada, our Prime Minister is obsessed with another issue: grinding down gender disparity in the oil fields. Says he: “Well, you know, there are gender impacts when you bring construction workers into a rural area. There are social impacts because they’re mostly male construction workers. How are you adjusting and adapting to those?” So, you see, what we really need is more women in the oil patch because what we need, according to our fearless leader, is “not to be nice or to be better or to be moral, but to be smart about getting the very best out of all of our citizens and making the very best out of our economy, because women entrepreneurs tend to make better choices than others…” And I don’t believe he was referring to women entrepreneurs like Mrs. Miller in McCabe and Mrs. Miller. Makes you want to cry.

    • Replies: @Buffalo Joe
  95. Anonymous[151] • Disclaimer says:

    OT: Ocasio-Cortez goes off the rails

    https://www.dailymail.co.uk/news/article-6679401/Ocasio-Cortez-wipes-away-tear-vows-defund-ICE-claims-Trump-hates-immigrants.html

    Rep. Alexandria Ocasio-Cortez wiped away a tear Thursday during a press conference held by a liberal group to protest the continuing flow of taxpayer dollars to Immigration and Custons Enforcement.

    Fellow congresswoman Ilhan Omar, one of the first two Muslims elected to Congress, quoted Somali poet Warsan Shire in explaining why migrants trek 2,500 miles from Central America to the United States.

    ‘No one leaves for the mouth of the shark, unless the mouth of the shark is safer than home,’ Omar recited.

    The young New York upstart’s celebrity has so far outpaced her authority to move legislation or confront Republican opponents.

    But she vowed Thursday to defund ICE completely and claimed Latinos should be exempt from criminal proceedings and immigration laws because they are descended from Mesoamerican cultures that preceded the United States.

    ‘We are standing on native land,’ she claimed, speaking just outside the U.S. Capitol. ‘And Latino people are descendants of native people. And we cannot be told, and criminalized, simply because for our identity or our status. Period.’

    I know a lot of Dems basically agree with her, but this is exactly the sort of rhetoric that they’ve been studiously trying to avoid. Bad move on her part.

    • Replies: @Corn
  96. George says:

    Are the shale boom workers well paid?

    I wonder if you compared the shale rush to past mineral rushes if you would find that the shale workers are being screwed. Ordinary workers at Virginia City NV actually became extremely wealthy, what today would be called a billionaire. Any oilfield workers may the Richest Americans lists?

    The culprit might not be the oil companies, it is probably the government taking the lion share in taxes.

    Virginia City NV produces super rich
    https://en.wikipedia.org/wiki/John_William_Mackay
    https://en.wikipedia.org/wiki/Bonanza_Kings

    Started close to the bottom rung and became the wealthiest capitalist.
    https://en.wikipedia.org/wiki/Cornelius_Vanderbilt

    What distinguishes the current US from the distant past is actually how few people from events like the shale boom acquire huge wealth.

  97. @Abelard Lindsey

    That’s interesting, and I agree with your assessment.

    You might be interested to know that when I was in college in the early 1980s in Colorado, I knew an ordinary, white, American college student who went to Alaska one summer to clean fish in a processing facility. He did it because the job paid a lot of money.

    As I recall, he said he made $10,000 in one summer of hard work cleaning fish in Alaska. So that is another job that Americans have always been willing to do for the right price. I’m sure those Filipinos are nice, and I’m not knocking what you said at all, but we really don’t need them to do the job. Or maybe we do, since young Americans aren’t what they were even when I went to college.

    • Replies: @Lot
    , @ben tillman
    , @Ibound1
  98. George says:

    “Mexicans are good at their hands (unlike blacks) but are still drawn to agriculture and construction, but not oil.”

    I am fairly sure that shale boom jobs are e-verified on the books jobs. My guess is that ND is more persnickety about workers being on the books in general. Is ND a sanctuary state?

    In actual South of the border countries the most serious attempt at a shale boom is in Argentina, which so far has not progressed very fast. Shale requires all sorts of rare inputs like special sand that have to be supplied.

  99. J.Ross says: • Website

    Is it because oil generally makes money, and the whole idea of mittromneying is to squeeze money out of a cash cow that has seen better days?

  100. Lot says:
    @Anon

    That could be the case.

    It may also be that low IQ populations just don’t do full demographic transitions. The higher IQ muslims in Iran and Tunisia did for example. But will SSA ever progress to universal female literacy and high relative wages?

    If Africa stays dependent on agriculture (rural) and resource extraction (male dominated) rather than services and textile and other light manufacturing as it’s source of income, maybe TFR will stay 3+ until malthusian limits.

  101. anon[166] • Disclaimer says:

    Slightly OT:
    https://www.texasmonthly.com/articles/yall-smell-that-thats-the-smell-of-money/

    It’s long and there are some slow parts worth skimming (like some of the intro), but that piece really gives a feel for what an oil boom is like on the ground.

    There’s a palpable electricity in the air. Closest experience an average Joe might have to it might be the late 90s when stock market was blasting and everyone was getting rich. But it’s much more intense and mixed with aspects of a Land/Gold Rush and the Wild West.

    Would be real fun to participate in if you’re relatively young, have some industry specific knowledge/know-how, and a little capital. It’s a market orgy where an independent little guy can actually do his own thing, like in the old days.

    I guess I should add, exciting for a young guy, probably not so good for the local social fabric or if it happens in your own backyard.

  102. Lot says:
    @Buzz Mohawk

    I know two unrelated middle class American college students who did the same in the early 00s. Not cleaning fish in Alaska, but working on the boats. Ran into a US born MexAm who did the same.

  103. @countenance

    That’s part of it, but it’s also the fact that the Left are fundamentally parasites, and nothing produces more than the energy industry. Of course, most of the parasites depend on this production for their existence, but that doesn’t change the fact that the most-productive are their greatest political enemies, who must be subdued.

  104. Anonym says:
    @Charles Pewitt

    https://www.breitbart.com/politics/2019/02/06/trump-reverses-wage-boosting-campaign-commitment-demands-more-legal-immigration-we-need-people/

    If by 2020 we have no wall and Trump keeps pulling this race replacement crap I for one am not going to vote for him. With any luck RBG dies soon and hopefully the older conservative SCJs retire so that Trump can execute one of the few things he knows how to do as a president.

  105. @Ryan Andrews

    Where the productive go, the parasites will follow.

  106. @Buzz Mohawk

    Lots of my fellow Ivy League students did the same thing (the fish factories in Alaska), as in 6-12 each summer.

  107. Thud says: • Website
    @FPD72

    Nonsense, bringing in diversity from where? all major oilfields around the world are run by western expats, the locals have token positions and are uniformly useless.

    • Replies: @FPD72
  108. @Abelard Lindsey

    It’s remote, but it’s settled. The Filipinos are arriving to pre-existing infrastructure. They are not pioneers.

  109. @Yojimbo/Zatoichi

    What percentage of Oil and Gas industry is unionized? If there is significant union representation, that might explain some of it.

    None is unionized.

    • Replies: @FPD72
  110. @Unladen Swallow

    Whereas college dropout Chuck Todd deserves the millions paid him for nothing more than being a link in a chain of ethnic nepotism.

  111. Central Banker Shysterism and some sand and some slippery glop and some other crap brought on the Shale Oil Boom. Be careful not to put the shale oil cart before the central banker horse.

    Cheap loot gets you cheap oil. I don’t know if that’s true, but the monetary extremism of the last few decades produced the atmosphere conducive to gloppy grit slipping the oil out of the ground.

    Slippery People is not just a song from Talking Heads. Slippery people is central banker shysters.

    This guy in NY Times is skeptical of shale oil and financialization:

    A key reason for the terrible financial results is that fracked oil wells show a steep decline rate: The amount of oil they produce in the second year is drastically smaller than the amount produced in the first year. According to an economist at the Kansas City Federal Reserve, production in the average well in the Bakken — a key area for fracking shale in North Dakota — declines 69 percent in its first year and more than 85 percent in its first three years. A conventional well might decline by 10 percent a year. For fracking operations to keep growing, they need huge investments each year to offset the decline from the previous years’ wells.

    Because the industry has such a voracious need for capital, and capital costs money, fracking could not have taken off so dramatically were it not for record low interest rates after the 2008 financial crisis. In other words, the Federal Reserve is responsible for the fracking boom.

    In other words, the Federal Reserve is responsible for the fracking boom.

    https://www.nytimes.com/2018/09/01/opinion/the-next-financial-crisis-lurks-underground.html

  112. J.Ross says: • Website

    Vice is shocked to learn that Greece (which you may recall is a living late-19th century cartoon of debt injustice) believes Jews to be powerful. THIS COMES COMPLETELY OUT OF LEFT FIELD.

    74% of Greeks believe that “Jews control international affairs”, 85% have “overwhelming power in the business world” and 60% that Jews “continue to talk much about what happened to them in the Holocaust”.
    In a sample of 1,000 people, 75% say that Jews exploit the Holocaust for their own benefit, 65% say Israel treats Palestinians like the Nazis [sic — the journalism major meant to add “treated the Jews”], while 71% declare certain Jews “have power” , either as citizens or as a state or as businessmen.

    https://www.vice.com/gr/article/vbwvxx/oi-ebraioi-kybernoyn-ton-kosmo-pisteyoyn-epta-stoys-deka-ellhnes?fbclid=IwAR1mVxytKSIkVS4gWdFIMJQlTSB3Dt78jC3mifLC08aB0xsYuF252b8Bg1g

  113. fish says:
    @Tiny Duck

    Ohs Tinys…….

    I be not dun witchu…….not fo a couple mo strokes no how.

    Lendsnert “………..X……….” Pittx

  114. FPD72 says:
    @ben tillman

    Downstream operations, especially refineries and transportation, are heavily unionized. The oil company response has been to use outside contractors for maintenance, turnarounds, etc., with only the operational staff unionized.

  115. Anon[325] • Disclaimer says:
    @Anonym

    More sense of adventure and masculinity in working on oil drills than picking tomatoes.

    Why are there so many Jews in media and academia? Don’t Jews respect manly work with risks? Why don’t they roll up the sleeves and do some real work once in awhile?

    • Replies: @Anonymous
    , @Dan Hayes
  116. FPD72 says:
    @Anon

    If a slickline parts or otherwise is lost in the wellbore, there is no need to drill a new well. In fact, there is a special “fishing” method used to remove stuck wireline cable from a well, called “cut and thread fishing.”

    • Replies: @Anon
  117. Anon[325] • Disclaimer says:
    @The Alarmist

    Because, it’s The American Way®!

    Jobs in Natural Resources and Agriculture are two things that can’t be exported. They have to be done in the US. When it comes to agriculture, the skills and pay are so low that they generally repel Americans and attract people from South of the Border. It’s seen as Peon Work. It’s not even Prole. Also, agricultural work is something that can be done by women as by men. Not much of a manly stamp on that kind of job.

    One thing for sure, nationalism favors the masses, globalism favors the elites. Elites are far more adept, skilled, and knowledgeable in creating networks around the world. They went to best schools, know ‘best and brightest’ from around the world, have insider connections, and have the means to travel and see the world. The masses not so much or not at all.
    So, globalism gives a huge edge to the global elites over the national masses.
    In contrast, nationalism favors the national folks because it’s about them electing leaders to represent the people of the nation. Also, a national economy prioritizes what is good-for-all-the-nation over what is best for elites.
    Because of the national mass pressures on global elites to come back down to ground, the latter goes about trying to globalize demographics itself. Ships jobs overseas and import peons and grinds to do the bidding of the elites. And these new peons(usually brown) and grinds(usually yellow) side with the Power that let them into the richer West: Globalist Elites.

    It’s too bad Ross Perot didn’t explain this too well in 92. Looking back, he had more sense than both Bush Sr. and Clinton.

  118. Wilkey says:

    “Modern immigrants aren’t nation-building pioneers”

    That almost goes without saying. In the late 1700s/early 1800s the Southwest USA, from Texas to California, was there for the taking. Mexicans never bothered to take it. More English-speaking Americans were moving in than Spanish-speaking Mexicans.

    It’s like the old joke about the two Mexicans commiserating at a bar about how the United States stole half their land. “Yeah,” says one to the other, “and they stole the half with the best roads and schools.”

    People just don’t appreciate the risks and difficulties that come with real settlement of a new area. You have no infrastructure, no roads, difficult access to supplies, and, oh yeah, you have to engage in some serious diplomacy with the natives.

    And so it’s ironic that America’s real settlers are treated as lazy thieves who leaned on natives for “help” (very little help, in reality) while “stealing” completely unimproved, unsettled land. Meanwhile modern immigrants are treated as brave pioneering heroes for crossing a small river and settling the harsh, unaccomadating wilds of…East L.A., where Whole Foods stores and good sushi restaurants are painfully hard to come by.

    America’s original settlers faced real risks and are treated like villains. Modern immigrants face no risks at all, but are treated like heroes.

    • Replies: @Redneck farmer
  119. Yes, safety, as you mentioned because accidents can lead to multi-million dollar payouts to the injured. And, at least for offshore drilling, accidents can cost into the many billions of dollars if there is an ecological disaster as with BP in the Deepwater Horizon incident.

    • Replies: @Buffalo Joe
  120. @Taysse

    Tay, Trudeau is the Northern embodiment of Andrew Cuomo. No roustabout wants to work with anyone who can’t carry their end of a drill pipe, whether that person be male or female. But notice how Trudeau veers at the end and switches from workers to “entrepreneurs.”

  121. @Federalist

    Fed, I thought the special effects in the movie “Deepwater Horizon” were spectacular.

  122. Ibound1 says:
    @Buzz Mohawk

    When I was in high school in the 70s, college bound white American high school kids from middle class homes still picked tomatoes and were paid by the bucket. Not to mention working in McDonalds and as movers for local stores and in car washes and and as busboys. Even mowing lawns. I think what killed it for middle class kids was the demand for high prestige items on the resume for college. Now every kid wants to say he helped a refugee family from Somalia.

  123. Romanian says: • Website
    @Intelligent Dasein

    Comments like this one are why you have Intelligent in the name.

  124. Romanian says: • Website
    @Paleo Liberal

    Unless you are hosting one of those companies that has a veritable monopoly on some ICT related area, having programmers in your city will not turn your economic fortunes around. They basically change your city into a sort of bedroom community. They might spend some of their paycheck there and drive up the housing costs, but that is it. Having a company there will net you some taxes, but that is it (but you were talking telecommuting). This is because factories will build up supply chains which are at least partly local and regional. An IT company will just use electricity.

    • Replies: @Paleo Liberal
  125. Anon[257] • Disclaimer says:
    @Intelligent Dasein

    Thanks so much for the excellent information

  126. @FPD72

    Thanks. First comment (including Steve’s post itself) from anyone who seems to know something.

  127. @Intelligent Dasein

    For example, it has taken roughly $4 trillion worth of exploration over the last decade simply to maintain the current output. Who has that kind of capital just laying around?

    Um, an industry whose revenues exceeded $4 trillion over the same period?

    • Agree: Federalist
    • Replies: @Kratoklastes
  128. @Anon7

    Who wants to live in the white man’s world?

    • Replies: @Anon7
  129. @ben tillman

    I went to an elite college. Won’t say which one.

    One summer a fellow organized a group of friends to clean fish in Alaska. Some of these were from wealthy families, and did the hard work anyway. The guy who organized the group is now a US Senator.

    I read that Hillary Rodman cleaned fish in Alaska one summer.

    In those days one could pay for a year’s room board and tuition at an elite school with a summer on the fish lines. No joke. Top colleges were 5-7 k total back then.

  130. @Romanian

    I was thinking more along the lines of how artists have turned some remote areas into thriving artist colonies. Although there is little in the way of supply chains, and some of them sell their art from home, they tend to gentrify these towns — renovate the houses, etc.

    A bunch of programmers would do even less when working remotely. An office in that town would at least generate support staff.

    However, an influx of high income workers could help support the stores and restaurants, creating at leading a few blue collar jobs in areas that are hurting.

    Interesting that there are a number of artist colonies close to Madison. A few are close enough to also be suburbs of Madison. The best known artist colony near Madison is Spring Green. Spring Green has Taliesin (founded by Frank Lloyd Wright), the House on the Rock and the American Players Theater.

    • Replies: @Romanian
  131. Twinkie says:
    @ben tillman

    Lots of my fellow Ivy League students did the same thing (the fish factories in Alaska), as in 6-12 each summer.

    Those ads – for fishing boats and canning factories – were all over the Ivies late 1980’s – early 1990’s.

  132. Asagirian says:

    Latinos are native to the Americas? Weren’t they the first imperialists?

    Btw, if Americas belong to the ‘Latinos’, why should there be more immigration-invasion from Africa and Asia?

    ycmtsu

    • Replies: @Anon
  133. Franz says:

    Worked steel back when Big Steel had our own energy fields including coal and natural gas, plus (especially useful in my case as a naval veteran) our own supply chain. Ore and coal ships crawled the inland seas and the Edmund Fitzgerald was a vessel owned by my old company.

    1. Everyone who said “capital expenses” of big industry reduces the importance of wages is right. When the old integrated steelyards ran their own rail lines, complaining about wages is bonkers.

    2. Even in the 1970s dirty work attracted plenty of fellows with advanced degrees. Those of us at the ore end had the biggest spread: Illiterates from the Thirties rubed shoulders with PhDs who could not find a reliable position in their fields but still needed a middle class wage.

    3. Unions were almost redundant even then. Union or non-union in steel was about the same because there was lots of nepotism; my uncle got me in. I got a service buddy in, and all that.

    Steelworker chief Lynn Williams in the early 80s said, let’s scrap the AFL-CIO and all the US labor laws and just fight it out. He was right; whether unions or corrupt or infiltrated, they stopped mattering much in industry when steel unions were ignored by the bankers’ price hikes during the Kennedy years.

    But that’s unions in industry. Unions for teachers (etc) are a New Deal legacy that nobody in pluperfect hell has ever figured out. The nature of their work means they’d be contract workers anyway, so unions for them make no sense. But they make all the noise. None of us ever figured that one out at all.

    Concern about unionization was mostly hot air. In the USA unions are a European transplant that never took very well. Lots of less formal ways to approach it. The Europeans and Japanese union guys that visited our site back then thought we were were all dupes for the corporations. They might have been right.

  134. Muse says:
    @Muse

    Note to Ron Unz. I posted two comments here because the first initially disappeared into the ether. I thought I had inadvertently deleted it. Tried to post the comment again to no avail, and they both showed up under moderation halfway through the day, and now they have both beeen posted.

    EDIT This comment behaved normally in that it immediately appeared as under moderation and this addenum was completed within the four minute editing window.

    • Replies: @J.Ross
  135. @Intelligent Dasein

    We can no longer afford our addiction to increasingly scarce and difficult to obtain petroleum.

    Replace petroleum with what?

    Oil is not increasingly scarce. It is increasingly available because of technologies that allow oil to be found and produced when and where it was previously impossible or unfeasible. The price of oil is low currently and exploration/production is nowhere near capacity. Ask people who work offshore in the Gulf of Mexico and the people in the localities that support the industry how scarce oil is right now.

    • Replies: @anarchyst
  136. Romanian says: • Website
    @Paleo Liberal

    Could be, but it is an undignified sort of boost for the local population.

  137. Bill P says:
    @ben tillman

    I wonder why they didn’t actually catch the fish like the working class kids I knew in Seattle. It pays a hell of a lot better, but then again it doesn’t surprise me that the skippers wouldn’t let them on the boats. Aside from the obvious problems with having spoiled smart-asses as subordinates, lots of them probably would have been tossed overboard by the crew.

    • Agree: Dan Hayes
  138. High capital intensity pretty much explains it all – the labour used in the sector has a high marginal value product (aka marginal revenue product), and MVP/MRP is the key determinant of wage rates.

    Celà explique tout (ou presque).

    Enterprises are not charities: they will not raise total labour compensation above the MVP/MRP. Total labour compensation is wages, plus all other stuff furnished by the firm (family days, barbeques etc).

    A lot of people will twist themselves into knots trying to confect some alternative explanation – because w = MVP is the key reason why wage floors do little except increase unemployment: that means a wage of zero for those who are priced out of the labour market by the wage floor, regardless of whether the wage floor is a legislated “minimum wage” or a sector-specific “union wage”.

    It’s the supply side of the labour market that requires compensation for remote working conditions, significant physical hazard[1], etc – not the demand side.

    A worker could require a higher wage rate for those things, but if he’s a worker in an industry where productivity does’t warrant it, he’ll be shit outta luck. (e.g., Coal miners in Appalachia, steel workers in Youngstown and Gary, auto workers in Detroit).

    It’s the same combination of characteristics that was/is present in the Australian mineral sector – the acronym “FIFO” (fly-in, fly-out) is well-known these days; at the height of the resources boom, 20-somethngs with little or no industry experience could sign up in the Eastern states, and be earning a solid 6-figures in Western Australia within weeks (mostly in iron ore mines).

    Not because the work was remote, or physically taxing, or (slightly) dangerous, but because their labour is mixed with tens of billions of dollars’ worth of highly productive modern capital.

    And if that capital can be automated, the MRP per worker rises dramatically, but the number of workers required to produce the profit-maximising output falls. At full automation, the MRP is notionally zero: no prizes for guessing that the number of ‘line’ employees is likewise zero.

    As examples:
    • Huawei’s devices contain 28.5 second’s worth of labour per unit, and a plant that produces 3 million devices a year has 17 staff;
    Rio TInto has a driverless train in operation in the Pilbara)

    The Huawei employees will all be well paid (Huawei is paying its Japaneses employees twice the going rate… but they won’t employ many people).

    By contrast, the guys who used to drive trains in the Pilbara (ave salary in the low 6-figures) are the local equivalent of buggy-whip manufacturers.
    .
    .
    The resources boom in WA (Western Australia – roughly speaking, the western 1/3rd of the land mass) has a number of good parallels to the oil business in the US. Large-scale mining is probably more capital intensive, if anything.

    The WA mining boom drove up housing prices to ridiculous levels – some of the highest costs per sq.m. in the world at the time: much higher $/sqm than central Paris, Vancouver, or Silicon Valley.

    There is also a story (perhaps apocryphal) that barmaids and grocery-store workers in remote mining towns, were being paid 3× or 4× their city counterparts despite mostly being locals – otherwise they would just sign on at a local mine.

    Rents skyrocketed: people were paying $2K a week for a pretty ordinary house in places like Port Hedland – a town of 14,000 people, ~1300km north of Perth.

    And Port Hedland is a dreamscape compared to the mining towns of the Pilbara – places like Karratha (pop: 16,000)… have a look at the best photo of Karratha that the WA tourist authorities could come up with: At least it’s near the coast. Inland, it’s drier, hotter, redder, dustier… and no sea breeze, ever.

    In 2013, the resources boom was causing a housing ‘crisis‘ as a result of hot money buying up rental property to ‘chase’ blokes who brought their families over ‘permanently’ (oops!): when the boom tailed off, house prices in Perth dropped like a fucking rock, and since 2017 there’s talk of a housing glut.

    FWIW … I have a very fond regard for the Aussie resources sector: when our family came to Straya (from NZ) in the early 1970s, Dad worked in a gold mine (Peko) – 10 miles from Tennant Creek in the Northern Territory (zoom out from that Google maps satellite image, and see what’s around:45 years later, the answer’s still “fuck all”). Talk about your dry, hot, dusty, red, inland mining towns…

    Working 1300 feet below ground, Dad finished every working day as black as the arse of a goat (but he always arrived home clean as a whistle).

    At Peko, almost all the single men lived in 2-man huts on the mine site unde4r almost military discipline – you can the huts on this site about halfway down the page: primitive doesn’t begin to describe it. As you might imagine, weekends in the main street were a mixture of revelry and drunken brawls with local aborigines (who gave as good as they got).

    Peko held ‘family days’ from time to time, which involved an incredibly lavish smörgåsbord in the mine premises itself. That’s the only time we got to see Dad come out of the hole: to this day, we joke about what my youngest sister said – she was 4 at the time …

    “Mummy, look! Daddy looks like a booga-nooga!”

    They paid staggeringly well (Dad bought a new car with his second month’s paypacket). And they looked after their workers. They didn’t do it because of unions or altruism, or because the work was hard and unpleasant: they did it because the workers had a very high MRP.

    We spent the first few weeks in a caravan park, and as a 7 year old it was the best adventure imaginable and I have nothing but fond memories of our entire time in Tennant Creek.

    If metropolitan Strayans behaved more like Tennant Creekers circa 1973, Oz would be even better (it’s still pretty good): smart-arses would get the sass beaten out of them in their teens, and everyone would comport themselves better.

    [1] hazard is used in its specific sense: the probability of injury multiplied by the cost of injury.

    • Replies: @Achmed E. Newman
  139. Svigor says:

    Maybe to ask is to answer?

    The whole point of cheap labor from the third world is that it’s cheap, often illegal (so no recourse), and compliant. The )))oil((( boys can’t get cheap labor from Mahico – whether Mahicans aren’t competent enough, or don’t want to do the work that White Americans do, whatever.

    So if they can’t attract White guys, they got nothin’. And White guys aren’t cheap, compliant peons. They’re kinda uppity.

  140. Paul says:

    Is oil and gas a sector of the economy with less competition? Are labor costs a smaller percentage of expenses?

    Marxists have contended that petty bourgeois, small business owners are trapped between the big bourgeoisie and the working class (that they fear being pushed downward, and that makes them a particularly nasty class).

    • Replies: @Steve Sailer
  141. Svigor says:
    @Cicerone

    That could be part of it, but there’s gotta be something else because the same is true of agriculture, and they’re obsessed with labor costs. Unless (((Big Media))) been lying all this time, which is eminently possible.

    Jack D:

    This ain’t the chicken plant.

    Now that makes sense.

    • Replies: @Almost Missouri
  142. J.Ross says: • Website
    @Muse

    When the post is new, it obscures the comment in an impenetrable veil of midnight, then shows it long after the edit option has expired. This is consistent (and possibly deliberate, to punish fristing and haste). It’s not a bug or a one-off.
    I hear Wells Fargo is having trouble but it’s probably the weather screwing up infrastructure. Bank runs in France and Belgium are probably related to the Yellow Vests.

  143. @Paul

    Interestingly, mines, such as coal in Kentucky and metals out west, had the most spectacular labor-ownership conflicts. E.g., see Hammett’s Red Death about Montana.

    Oil and gas, however, not so much.

  144. @International Jew

    Um, an industry whose revenues exceeded $4 trillion over the same period?

    Um… nope?

    Revenue is not what determines the profitability of a set of projects: that would be profit.

    A set of projects that would satisfy a ‘normal’ RoR hurdle (say 700bp above the risk-free rate, or 300bp above WACC) would require annual profits equal to (roughly) 9% of project outlays, in perpetuity. And when I say ‘profits’, I don’t mean EBIT, or EBITDA, I mean NPAT – when all the costs of operations and capital replenshiment are covered, and the gigantic ticks and leeches of government, have had their fill.

    Annual NPAT of 9% of project outlays is a pretty high hurdle – which is why all major energy-sector corporates spend small fortunes bribing politicians and bureaucrats, to ensure that they never have to pay tax.

    If revenue over a 10 year project life was barely equal to project outlays, annual revenue would barely touch 10% of project outlays (especially since later-year revenue has to be discounted back).

    So to meet the NPAT hurdle of 9% would require NPAT/Revenue of 90%… never gonna happen, in any industry, ever.

    As to how successful large corporates are in trying to ensure that the “T” in “NPAT” is as close to zero as possible…

    Here in Straya, our government mandated that our tax authorities release a list of the tax doings of major corporates every year: no surprise that the resources sector paid zero net tax on literally tens of billions of revenue. See “Naming and Shaming the Nation’s Biggest Tax Cheats.

    Good on ’em, I say: I don’t consider it ‘cheating’ to give nothing to the wasteful parasitic cunts of government. Denying sustenance to the gigantic parasitic government gravy-train is an inherently moral and noble act, even if you then spent the entire proceeds on financing porn-snuff-flicks, giving carfentanyl to school children, and al-Qa’eda subscriptions.

    Plus… corporate officers have a fiduciary responsibility to maximise returns to shareholders: they have no ‘social obligationsand nor do any of us.

    Plus, anything that
    • makes it clear to the livestock that .gov is an agent of capital, and/or
    • undermines faith in the system
    … is a good thing.

  145. Oily Earl says:

    It’s because one stupid mistake can destroy an entire oil rig, level a half block of houses, and generate lawsuits carrying into the next generation. Jews won’t do the job, Asians don’t let like it. Only brains left are the white guys. You certainly don’t want to pile up black and/or Mexican workers to be wandering around that kind of potential liability. Even as a worker, you don’t want a dimwit on your crew who could get you blown up very easily. One misplaced cigarette is all it takes.

    Oil derrick jobs are hard to compartmentalizations. Everybody can wind up partially involved in another persons responsibilities. The less “floating negative variables,” the better.

    Everyone who knows better quietly agrees, and they don’t complain about it.

    It’s called, “leaving well enough alone.”

  146. @James Speaks

    Someone will try to impose your joke.

  147. Anon[419] • Disclaimer says:
    @FPD72

    Looking at job listings and how-to-get-an-oil-or-gas job sites, it seems like you need a bit of training or certification that takes a bit of time and costs a bit of money. So the jobs have a “deferred marshmallow” filter. You need to be able to save a bit of money in order to pay for some training and live off of savings while you get the training, then get the training, and then apply for the job. You don’t just apply for the job and get it.

    So the trait of planning for the future is necessary, and that is correllated with intelligence, which in turn is correllated with nonvibrancy.

    I also get the impresion that there is a hint of, not exactly nepotism, but the passing on of information within one’s broader social group about these kinds of jobs, kind of a higher paying version of Cambodians and donuts or blacks and government jobs. But this alone, without the deferred marshmallow trait, is not enough to explain it completely.

    • Replies: @Cleburne
    , @FPD72
  148. @Wilkey

    Steve’s essay “Carved Upon The Landscape” explains why.

  149. Neoconned says:
    @Anonym

    I work at a casino now but by far the best job I’ve ever had was doing cleanup work in 2010 on the BP oil spill…..pay was 14$ per hr and we worked 84 he weeks……

  150. Anon[111] • Disclaimer says:
    @Asagirian

    I was watching a popular semi-annual television show here in Japan last night, “Kasou Taishou.”

    https://en.wikipedia.org/wiki/Kasou_Taishou

    It’s hard to explain, but amateurs compete in skits that involve some sort of visual puns or special effects, and these often involve the participants applying face paint to play certain parts. A lot of them involve “invisible” background people in the tradition of Japanese puppetry, with a black background, black body suites, and … blackface makeup. (And there are a lot of skits that require greenface, blueface, redface, silverface, etc.).

    For example, here’s a stereo equalizer display skit from last night (great for the abs):

    I was just thinking as I watched that, however functional the blackface was in context, yeah, in the U.S. it probably would have caused a problem in the current day. The show would be cancelled, or maybe form-fitting black ski masks would be used … but in light of Gucci, would ski masks pass? Maybe Antifa headgear would pass? Maybe not? Ninja wear is O.K., right? No?

    • Replies: @Steve Sailer
    , @J.Ross
  151. @Anon

    Hopefully, there’s a clause in the September 1945 surrender treaty that allows the U.S. to resume strategic firebombing of Japan in case of inappropriate makeup.

    • Replies: @Achmed E. Newman
  152. Cleburne says:
    @MikeatMikedotMike

    And starting at 100k in the Permian. And a hell of a lot of Louisianans all over the Texas oil patch, which is interesting and fun. Good cooking comes with the Cajuns.

  153. Cleburne says:
    @istevefan

    Louisiana light sweet is nearest gulf coast refineries (mostly from Eagle Ford in south Texas), so it commands a premium. West Texas reflects more mid continent pricing. The interesting one is Midland, the price in the Permian. Due to pipeline constrains it’s been at a discount of as much as $20. Some of the Albertas grades were $40 dopisciunt as I recall.

  154. Cleburne says:
    @Anon

    It’s hard, sweaty, dangerous work in some pretty dreary places. You do NOT see a lot of blacks on the frac spread.

  155. Several commenters have properly pointed out the physical risks to rig crews and the financial downside faced by the shareholders. Much of the industry’s wage premium also reflects the financial risks faced by the wage earners. The oil and gas industry is brutally cyclical. Ask anyone who got a BS degree in Petroleum Engineering around 1980. The starting salary would have been very high by national standards but almost half of those would not have been able to keep working in the industry at all by the late 1980s. The industry did not enjoy a widespread recovery until the early 2000s.

  156. WJ says:
    @obwandiyag

    I work in the industry and you can be assured that the pay is significantly higher than in other industries.

    It’s not that dangerous. Some work place fatalities occur such as the blowout and explosion in Oklahoma a year but they are rare. Safety is stressed to the sometimes frustrating extreme.

    The work can be contingent but so what? Many o and g workers make enough money to get them through extended down times.

    • Replies: @obwandiyag
    , @Jack D
  157. O&G is capital, not labor, intensive.

    Large oil refineries operate with direct employees counted in single digits.

    Some oil equipment is super costly.

    A single blowout preventer runs in the eight figures.

    Relatively small headcount = relatively low pressure to control the cost of that labor.

  158. J.Ross says: • Website
    @Anon

    This “invisible” background guy is key to bunraku and thus the basis of Jim Henson’s style of puppetry. It also allows brilliant effects that would be very difficult otherwise, like the “exploding walls” at the exposure of the student plot in Mishima:

    Maddeningly, the idea here is completely the opposite from American minstrel blackface.

  159. Anon7 says:
    @Achmed E. Newman

    I forgot all about that song. Of course, the answer to the question “Who wants to live in the white man’s world?” is “Everyone”.

    • Replies: @Achmed E. Newman
  160. @WJ

    You are exactly the kind of person I am talking about. You must be either really really ground down or lying (which is almost ubiquitous on the internet when people give personal information). If you think that is a lot of money, you do not know the value of money. If you think contingent is good, then you do not know the value of anything.

  161. Jack D says:
    @WJ

    Some work place fatalities occur such as the blowout and explosion in Oklahoma a year but they are rare. Safety is stressed to the sometimes frustrating extreme.

    On the Deepwater Horizon, on the morning of the explosion a BP VP had (ironically) just presented the crew with a citation for seven years without a lost-time incident. However, afterward the crew said that often the form of safety was stressed more that the substance – they would write you up for not wearing the proper safety gear but were pressing the crew to do unsafe things in the name of speed and would fire anyone who objected.

  162. @Kratoklastes

    Great stories, Kratoklastes! I had no idea you were strayan till just now. Your name sounds Greek to me.

  163. @Anon7

    I like the steel drum in it. This was good stuff from Elton’s heyday.

  164. @Kratoklastes

    If spending $4 trillion will get you $4.01 trillion revenue, then it’s worth doing.

    As it happens, the oil companies make way more than that in a decade. At 20 million barrels per day and current prices the US alone generates $4 trillion of revenue, per decade, for the oil companies.

    I know where you’re coming from with that capital budgeting net present value stuff, but you’re misapplying it. Best you avoid finance and instead stick to your areas of real expertise (based on your activity here) — weight training, martial arts, and hitting girls.

  165. JMcG says:
    @Kratoklastes

    I couldn’t agree with you more about the taxes, it’s time to hoist the black flag.

  166. Ed says:
    @Aslangeo

    Work in finance at a gas company, it’s not a drilling or exploration company, the blue collar guys are fairly diverse.

  167. black sea says:
    @mungerite

    But after losing a close friend and a brother to gun violence, he turned to rapping. [indeed, definitely the sort of American we need more of!]

    An interview with 21 Savage.

    • Replies: @mungerite
  168. Disturbing news on the fastest-growing-jobs front– it’s “gambling industry” in New York, “credit counselor” in Michigan, “political scientist” in Ohio (election year effect?), “costume attendant” in Georgia, “mobile home installer” in Washington, “animal trainer” in Oregon, “home health aide” in Pennsylvania and Delaware, “desk clerk” in Maryland, and, scariest of all, “information security analyst” in Virginia.

    Sun and wind work wins 12 states, while oil and other traditional extraction only four or five.

    And what the heck is a “patternmaker” that Arizona needs so many of them?

    • Replies: @J.Ross
  169. FPD72 says:
    @Anon

    Nepotism? In the well servicing industry it is not unusual to see entire crews (4 to 6 men, depending on the area) all related to each other. This is less common in drilling.

    In both industries there is employee loyalty to the crew leader, called drillers in drilling, operators in well servicing. If the driller or operator changes companies, he’ll often take his crew with him. The company men for the E&P companies who manage field operations will often express a preference for particular well servicing rig operators; they don’t care about the name on the iron as much as they prefer crews with whom they’ve had good experience or pushers (management level one up from operators) with whom they have a good relationship.

    Training and/or certification? It depends on the type of work. Most oilfield welders are required to be AWS certified. Anybody working on a pipeline is required to have DOT specified training and certification. Lease operators require everyone who works on their sites to have safety certification from organizations such as Rig Pass and to be H2S certified. Many lease operators require drilling contractor drillers and toolpushers to have IADC certified Well Control training. Crane operators are required to have training that meets OSHA requirements, which requires the passing of both written exams and competency tests. Many workers involved in oilfield construction are required to complete OSHA 10 hour training.

  170. FPD72 says:
    @Reg Cæsar

    There’s a reason for the old bumper sticker: “Please don’t tell my mother I work in the oil patch. She thinks I’m a piano player in a whore house.” Some of the raunchiest porn photos I’ve ever seen were plastered on the inside walls of pulling unit dog houses.

    But then I’ve also stepped into dog houses where the crew was conducting a Bible study. Midland, the headquarters of the Permian Basin, has a very strong Christian community.

  171. J.Ross says: • Website
    @Reg Cæsar

    >patternmaker
    Fashion or foundry? I hadn’t associated either with Arizona.
    In both cases the patternmaker works out production models from the designer’s less practical prototype.

    • Replies: @Anonymous
  172. @Reg Cæsar

    This man wants to rent your daughter

    [pic of torso of pudgy white guy in a business suit clutching his coat as he watches your call girl daughter undress]

    Meanwhile, in Fargo …

    FARGO — At least eight people were being held in the Cass County Jail on Friday morning, March 10, on suspicion of patronizing a minor for commercial sex

    demographics of Fargo
    White alone 90.2%
    Black or African American alone 2.7%
    Persons of Hispanic or Latino Origin 2.19%

  173. @mungerite

    21 Savage

    [MORE]

    Dr. Laura’s Rant Reiterates N-Word Is Never OK

    “It’s unacceptable,” said Abraham Foxman, national director of the Anti-Defamation League. “There’s no way that it’s acceptable. It’s not funny, it’s offensive to African-Americans. She should know better. There should be consequences.”

    Schlessinger said: “Black guys use it all the time. Turn on HBO and listen to a black comic, and all you hear is n****r, n****r, n****r.

    “Bitch Nigga” [not to confused with “Real Nigga” or “Fuckin Niggaz Bitches”]

    Yea nigga…shit nigga you was talking nigga?…like the rest of these rap niggas nigga?…pull it out, nigga then I dump…pull it out, nigga better run…Bitch nigga please [x7]…Strip a nigga out his clothes…bitch ass nigga I’ll slap ya…21 gang nigga we’ll clap ya…Bitch nigga please…Fuck nigga please…Pussy nigga please…Hoe nigga please…Scary nigga please…Fuck nigga please…Bitch nigga please…Nigga I’m young savage…Nigga I’m young savage

  174. @Svigor

    Labor may be a small-ish component in the price of a vegetable you buy at the supermarket, but it is not a small component at the point of production: the farm. By the time that carrot or whatever wends its way through (more mechanized) shipping, refrigeration, distribution and retail, that original labor component has been somewhat diluted away. Simultaneously, an error at the front end pulling up a carrot, costs you … one carrot. An error at the back end, e.g. refrigeration failure, costs thousands of dollars.

    Petroleum is kind of the opposite: as oil comes out of the ground, the labor component in its price is very small while the liability for error is large ($billions). As it gets parceled up and shipped out, the labor component incrementally rises while the liability shrinks till it reaches the undocumented Pakistani guy filling your tank at the corner gas station.

    Coincidentally, the pressure to reduce the cost of the labor in each stage of the above two streams shifts, but in opposite directions.

  175. @Kratoklastes

    The $4 trillion cost (if such it be) is already in before NPAT comes out.

  176. @Reg Cæsar

    It’s so hard to keep track of which way the Big Media winds will blow on subjects like prostitution. At one moment they’re dignified sex workers in the vanguard of the cultural revolution, deserving enhanced political representation. The next moment it is a blight that must be stamped out with all deliberate speed.

    Likewise, underage sex. One moment it is young people boldly choosing for themselves how to use their bodies, or quaint customs of vibrant exotic peoples. Then next moment it is a heinous violation for which no constitution may protect the accused.

    If only there were some way to know in advance how the media would spin each case, some Unified Field Theory of media bias …

    • Replies: @L Woods
  177. Anonymous[243] • Disclaimer says:
    @Anon

    More sense of adventure and masculinity in working on oil drills than picking tomatoes.

    Why are there so many Jews in media and academia? Don’t Jews respect manly work with risks? Why don’t they roll up the sleeves and do some real work once in awhile?

    Isn’t that part of the reason the media pushed so much hatred against the oil industry? It was a base for White Gentile economic power.

  178. @International Jew

    hitting girls

    Sorry, it was unfair of me to say that, without a citation. So here you go:

    http://www.unz.com/isteve/survey-do-you-think-youre-strong-enough-to-beat-most-people-in-a-fist-fight/

    …where you say

    I’ve taken an unsighted shot to the head from a 170lb trained woman (state-level karateka) that she seriously thought was going to put me on my ass (she ‘king hit’ me from the side); it barely registered. She already had her arms up looking for plaudits when I hit her back and ruined her day.

    • Replies: @L Woods
    , @Kratoklastes
  179. mungerite says:
    @black sea

    hahaha thanks that was awesome

  180. L Woods says:
    @Almost Missouri

    The only thing that will kill this latest and interminable wave of moral panic is if the “trafficking victims” start skewing towards underage males with homosexual clientele. Then, it will be Good, edgy, progressive etc as you describe. Until then, all we have is a putative flood of non-cartel pussy threatening to suppress prices — in gynocentric america, there can be nothing more important or worse.

    • Replies: @Anonymous
  181. L Woods says:
    @International Jew

    Well, she signed up for it. What’s the issue?

  182. Pontius says:

    High wages are the only way to keep people coming back after the inevitable bust. When you get a long downturn, like in Alberta currently, many will finally opt out and find other ways to make a living. Last time I was in Alberta, it was terrifying. Entire industrial parks have closed, some with service companies 40-50 years in the business. Brother in law, laid off from a six figure job at the Caterpillar dealer, luckily, able to retire. My brother, not so lucky, searching for work for a year and a half in his trade, took a job at a car dealer as a lot attendant. He was making over $90k/yr welding up service rigs and production skids. Unfortunately, welding has taken a toll on his 50+ year old body. He is in an unenviable position. He is welding again now but the clock is ticking on his health. No prospects for retirement. You better get rich or get high enough up the ladder to avoid the carnage. There’s a lot of pain behind those low gas prices. Unfortunately PM Trudeau has little or no interest in pressing for a pipeline, so it Canadian oil and gas workers are SOL.

  183. anarchyst says:
    @Federalist

    Far from being “fossil fuel”, hydrocarbons are not only plentiful but are being renewed by yet-unknown processes deep within the earth.
    The term “fossil fuel” was coined in the 1950s when little was known about the processes by which oil is produced. Oil is “abiotic” in nature, as even depleted oil wells are “filling back up” from deep below the earth’s surface.
    Oil interests are drilling wells at 5,000 feet, 10,000 feet, and 15,000 feet and coming up with oil deposits way below the layers where “fossils” were known to exist.
    “Peak oil” is a discredited concept that environmentalists and others are latching on to, in order to display their hatred of oil being a renewable resource as well as to push prices up.
    Follow the money.

  184. Neoconned says:
    @Intelligent Dasein

    Just curious & not denying your claim but where did you get that 4$ trillion dollar number from?

    Can u reference some links to academic articles or news articles?

  185. FPD72 says:
    @Thud

    Nonsense? What I wrote is directly from a petroleum engineer working for a major. He held a management position and started working in the industry in the 1970s. He has seen firsthand the emphasis on diversity and inclusion, often to the detriment of technical excellence. He has worked for three different majors and in both the USA and oversees.

    But I guess he doesn’t know what he’s talking about.

  186. It’s remarkable how the fracking boom has largely been a white male phenomenon, from the engineering to the manual labor.

    Mexicans are good at their hands (unlike blacks) but are still drawn to agriculture and construction, but not oil.

    It seems more like whites are just a better fit because they are literate enough in English not to blow up the project, but also bigger and stronger on average. Because of affirmative action, hispanics who are as literate can get scholarships and more pay for less work. Blacks even more so. Asians often are bright enough but not big and strong enough to compete in that labor market. Also, I don’t think Asian engineers relish the field work side of such projects as much as white guy engineers, many of whom like getting out there. Asians often seem to think that is lower status and would rather have a position sitting in an office for the same pay.

  187. Anonymous[287] • Disclaimer says:
    @L Woods

    “Until then, all we have is a putative flood of non-cartel pussy threatening to suppress prices”

    This horrifically sociopathic and dehumanizing worldview is what happens when “muh free market” libertarianism is taken to it’s logical conclusion. These manosphere psychos are the inevitable end result of a society that reduces all of human existence to atomized individuals making financial transactions.

    • Replies: @L Woods
  188. @Anon

    “have to be safety conscious individual, willing to learn”

    implied here is that they have some damned sense and recognize dangers

    also implied is must be able to learn

    intelligence required, but not credential

  189. @TG

    “a pissed-off petrochemical engineer forget to set a valve and a billion-dollar plant blows up.”

    When you resign/quit/get fired at an oil company, they send for security and escort you out on the spot, because they don’t want you to do anything like that.

  190. @Anon7

    “It’s not uncommon in a lot of these areas to see people with Confederate flags and things of that nature,” says Tosa Nehikhuere, a well engineer who worked on oil wells in Fort Worth, Texas, during internships as an engineering student at the University of Texas at Austin. “For a black person working in that environment, a lot of times it can be very uncomfortable because they obviously don’t fit in with that culture.”

    Uh, what?

    Last time I checked the vast majority of blacks live in the deep South and have been around that culture all of their lives, so they are likely totally comfortable with that culture. It is SJW reporters that aren’t comfortable with it. Little Miss Tosa Nehikhuere needs to get out more.

    • Agree: ben tillman
  191. @International Jew

    TL;DR: I’m qualified: if not the outright most qualified person in the thread, I’m close.

    The drivel below the “more” bit will take an adult ~5 minutes to read (it took me that long and I’m a slow reader). Nobody’s insisting anyone read it, but it makes a good case.

    If spending $4 trillion will get you $4.01 trillion revenue, then it’s worth doing.

    That’s what an advertising industry sales team would have you think, but it’s wrong.

    It assumes that the capital dedicated to the project is happy with a negative rate of return (because discounting makes that $4.01 trillion worth less than $4 trillion outlay, because it happens in the future).

    If those $4.01 trillion in revenue result in less than a ‘normal’ rate of return on capital (including a risk premium appropriate for the industry), then the project is a dud project and should not be undertaken.

    If the world were configured otherwise, it would be full of multi-trillionaires as a result of scaling up losing propositions: “If we lose $10 per unit, we can make it up on volume – let’s dial this motherfucker up to $4 trillion“.
    .
    .
    As to my capacity to judge… read on, or don’t; it’s a potted CV. Let’s just say I’m pretty confident.

    [MORE]

    “Weight training, martial arts and hitting girls” formed a significant part of my life from the age of ~17 through to Feb 1990 – the ‘Glory Days‘ that all men hark back to when they’re old.

    It’s what happened subsequent to that, that qualifies me to make statements about finance and economics.

    It’s hard to lay out the next ten years without it appearing boastful. Those of a religious bent will recall that a (fictional) first-century Jewish revolutionary said something about “not hiding lights under bushels” (even though this is all quasi-hidden under a ‘MORE‘ tag), so here goes…

    See, in March 1990 I went back to university at a Go8 university – i.e., one of the 8 best universities in the country: Monash University.

    Monash was ranked 3rd in the Go8 for Economics at the time. It was rated in the top 40 globally for undergrad, and 4th in the world (by standardised page count) for Econometric research. Now it’s rated just outside the top 50 globally, and 5th in the Go8.

    Anyhow… some years later I graduated joint top of my class, co-equal with my best mate and study partner (my 4-person study group took places 1,1, 2 and 4 in the order of merit).

    2500 first-years (‘freshmen’) resulted in 600 graduates (meritocratic attrition is a harsh bitch). Of those, 6 got ‘Firsts’ – and at the end of a 4 year degree, my mate and I were a literal dead-heat on average grade.

    Americans would call it graduating summa cum laude[1] – in Economics and Econometrics (including an HD[2a] in Accounting).

    As an undergrad I was awarded
    • a Vice Chancellor’s Undergraduate Research Fellowship (the only one in the 1500-student faculty), and
    • a Reserve Bank Undergraduate Research Cadetship (one of 4 in the country – I turned that one down).

    At Honours, my mate and I shared the Australian Bureau of Statistics Prize (for the outstanding student in Econometrics Honours); it was only $100, the cheapskates.

    I then got H1s[2b] for all Masters coursework subjects, and spent the rest of the 1990s as a PhD student (with a ‘priority’ merit scholarship) in the best CGE (economic modelling) think-tank in the world[3].

    During that time I was invited by Treasury to help them incorporate rational financial market expectations into TRYM – their macroeconometric model (the paper is still on the Treasury site): I had replicated their model as an undergrad and added rational expectations, and presented the results to the Econometric Society Asia-Pacific meeting in ’96 [4]… Treasury had been unable to get the model to solve with rational expectations when their 16-person team was building it.

    They also wanted our team to give them a talk on how to use a systems estimator, and how to ‘stress test’ the model in a way that enabled quantification of the uncertainty in the model: that latter thing was the focus of my PhD later – but with a model orders of magnitude more complex than TRYM.

    After the ’96 election, the Australian government introduced a value-added tax. I did the quant work analysing the implications of tax mix change on the cost and capital structures of
    • the Departments of Defence (national) and Justice (state);
    • the Police Force (state);
    • roughly half of the ASX100 (the 100 largest stocks by market cap) – telcos, major retailers, transport companies, airlines, brewers etc.

    My PhD topic was derived from a project I did for a major bank – analysing the sectoral distribution of the effects on profitability and capital-formation for a range of forecast scenarios, and identifying industries whose outputs were correlated.

    Effectively the bank was looking for ‘clusters’ of industries that were prone to making systematically bad decisions – especially over-capitalising when times were better than expected. This work supposedly saved the bank $40 million in the first year it was used to help determine sectoral risk allocation – our ‘tank’ barely got 0.1% of that, but it more than paid my way for the year (given that I was only working 0.35FTE – the maximum permitted under my scholarship conditions).

    After that, I was hired out (just as my scholarship was set to end – yay!) and spent a year as a mutual fund analyst; the changes I advocated to the fund-analysis process led the CEO to promote me to lead the equity analysis team – specifically to improve the quant side of the process.

    For shits and giggles, a few years ago I did the Wharton ‘Financial Engineering and Risk Management‘ modules (FE&RM 1 and 2) and got 100% for both.

    Sometimes weight training, martial arts and hitting girls is just the opening movement – the allegro prelude to an adagio – other pursuits that are still interesting but less exciting.

    Anyhow…

    With all that said: I still say that my most interesting job ever was after the military (et seq).

    It was a job almost nobody’s ever heard of, and which pretty much no longer exists (technology has pretty much driven it to extinction).

    In the mid-80s I worked as a smutterman in a flour mill for a year to get my head back into civilian life without having to interact with people too much.

    It was shift work – I wanted nights, so would trade shifts with the other smuttermen, and gave them the shift premium so they were strictly no worse off. During a shift, it was almost entirely solo, although during breaks the three shift members would eat together (the other two were the miller and the ‘topman’ – who looks after the gigantic sifters); that’s about the level of interaction I was capable of at the time.

    Anyway… WTF is a ‘smutterman’? Why “best job ever”?

    A smutterman oversees the process that
    • takes wheat from storage silos,
    • removes all the rubbish from it (metal, stones, sticks etc),
    • mixes different varieties so that the resultant flour has the desired qualities (whiteness, protein content etc),
    • sprays the mixed wheat will a fine mist of water as it passes through a final auger (to loosen the bran so that it detaches relatively intact),
    • stores the grist (as it is then called) in a conditioning bin for ~8 hours so that the moisture can work on loosening the bran;
    • controls the flow from the conditioning bin to the ‘first break’ roller (which has flutes (like teeth) so that the wheat is ‘torn’ apart rather than crushed – if it was crushed the bran would be fragmented and hard to sift out)

    The process by which wheat becomes flour is absolutely fascinating; just the process by which wheat is prepared for the ‘first break’ roller is a blend of science and art of which the vast majority of people are not remotely aware.

    Running the ‘smuts’ is a 1-man, 10-machine job – the wheat travels up and down a 3-storey mill 3 times before it goes into the conditioning bins for ~8hours.

    Although I had no understanding whatsoever of technical economics at that stage, the ‘smuts’ was a fundamental influence on my view about the importance of capital to modern industrial society.

    Here was me – at the time an ex-soldier with nothing but a high-school education – being the sole labour input for the preparation of hundreds of tonnes of process-critical inputs a day… impossible in the absence of tens of millions of dollars’ worth of capital goods. So anything that gets in the way of efficient capital allocation, is a blight on human progress.

    And the output of the process was, in turn, the most critical input to a food that has been central to life in the West for two millennia – bread. The staff of motherfucking life.

    The contrast with being a soldier (and after that, what is now euphemistically called a ‘contractor’) couldn’t be more stark.

    NOTES.

    [1] In the Strayan system, we don’t call it graduating “summa cum laude” – we call it graduating with “First Class Honours” (or ‘getting a First’). Oz differs markedly from the UK, where ~25% of graduates from top-tier universities get Firsts; in Oz it’s 1-2% and requires an additional (Honours) year. A ‘First’ automatically entitles one to a ‘full ride’ scholarship: fee relief, a tax-free stipend, and an easy gig as a TA. The TA gig was a blast – 0.35 of a half-decent salary in exchange for taking 2-3 hours of undergraduate tutorials per week: I taught ECM 3430 Applied Econometric Modelling (and lectured ECM4430 Quantitative Economic Policy when the lead prof was ill).

    [2] Again in the Oz system:
    (a) an “HD” (High Distinction) is a mark exceeding 85% in an undergraduate subject (in a class of 300 there might be 4 HDs);
    (b) an “H1” (First Class Honours) is a mark exceeding 80% in a Masters subject; it is restricted by convention to the top student in a Masters subject – but the top student in subject is not guaranteed an H1. (We don’t have “PhD coursework”: we do Masters coursework and on satisfactory completion are permitted to begin PhD candidature).

    [3] The Centre of Policy Studies at Monash University; it later moved to VUT (a non-Go8 university). If anyone claims that Purdue’s GTAP is better than CoPS, ask them why the US State Department chose CoPS to build USAGE.

    [4] Malakellis & Transom (1996) “Simulation Properties of TRYM under Alternative Specifications of the Financial Sector”, in McAleer et al. (eds), Econometric Society Australasian Meeting 1996 Proceedings Volume 3, Perth: University of Western Australia, pp. 91-118.

    • Replies: @Federalist
    , @JMcG
  192. anon[409] • Disclaimer says:

    Oil is a commodity and follows well known economic principles that tend to be painful. Particularly fracked oil, which is produced in quantity by smaller independents who will keep drilling until the money is gone. Russia & KSA have cut production to keep oil above $50/bbl. Barely. The independents have cash breakeven costs that are much lower than $50, but ‘all in’ costs are much higher than the cash breakeven figure.

    Back in the peak oil days, $100 oil was the new normal. They figured out how to drill em much more efficiently. They drill multiple zones for much longer distances and use a lot more propellant. And multiple wells from the same pad.

    The US has benefitted greatly from lower oil prices, not to mention becoming petroleum independent when we were running huge deficits a decade ago. Oil is only the tip of the iceberg. The US is now the low cost producer of fertilizer, chemicals, etc. There are also liquids, which can be refined into ‘purity products’ (ethane, propane, butanes, and natural “gasoline” (pentanes).

    All this (and more) takes $50 oil. Trump needs someone to tell him lower is better as long as it is above $50.

    • Replies: @Anonymous
  193. Dan Hayes says:
    @Anon

    Anon[325]:

    In NYC there are some Jews in the NYPD but very, very few in the NYFD. An Orthodox Jewish friend attributed this disparity to his coreligionists’ disdain for physical labor!

    • Replies: @J.Ross
  194. @Kratoklastes

    You had the nerve to start that response with “TL;DR”!

    • Replies: @Kratoklastes
  195. L Woods says:
    @Anonymous

    Oh please, cry me a river. Take it up with American women who offer so little in a relationship that they fly into a panic at the very rumor of competition with prostitutes, sex dolls, etc. Never will they offer a pinch of honey when a bucket of vinegar will do.

  196. J.Ross says: • Website
    @Dan Hayes

    Maybe risk analysis? There used to be an argument about similar Jewish preference for the Navy. Then again, there was a Navy recruiting station famously near to or in a Jewish population center in NYC.

    • Replies: @Dan Hayes
  197. @Federalist

    I was employing a usage diametrically opposite to what [I think] you’ve inferred (I’m not implying to inferred it wrongly: it was a perfectly sensible inference).

    The ‘TL;DR’ on my comment was meant to indicate – “This comment is hella long. The TL;DR version is

    “I’m qualified: if not the outright most qualified person in the thread, I’m close.”

    I certainly wasn’t trying to imply that the comment I was responding to was ‘TL’ so I ‘DR’ – it was only a few sentences, after all. (Also… responding to a thing after specifically declaring that you[1] have not read it? That’s fucked up, yo).

    I hate it when those smarmy cunts from Semiotics are right, and a piece of text is capable of [at least] two genuinely-disinterested interpretations, only one of which was intended by the writer. Stopped clocks, and all that.

    [1] ‘You’ in this case is the generic you, not you personally. I am almost fucking OCD on this ‘you’ shit now… English needs to sort that shit out: rather than fucking around with pronouns for psychologically damaged sexual deviants (‘xi’ and ‘xer’ and shit), we need to get an impersonal pronoun that’s way less faggy than ‘one’ … STAT.

  198. @International Jew

    Sorry, it was unfair of me to say that, without a citation

    No need for apologies, brother: I can count 6 or 7 women that I’ve hit off the top of my head – and that’s just the memorable ones.

    Bill Burr has an excellent ‘bit’ about the bullshit taboo on hitting women: a lot of them could do with a half-powered shot once in a while, just to let them know it’s not open slather on us guys.

    Plus, this is the internet: it can’t affect real life unless someone from HR sees it lol.

  199. JMcG says:
    @Kratoklastes

    The woodshed has a new king!

  200. Corn says:
    @Anonymous

    “Fellow congresswoman Ilhan Omar, one of the first two Muslims elected to Congress, quoted Somali poet Warsan Shire in explaining why migrants trek 2,500 miles from Central America to the United States.

    ‘No one leaves for the mouth of the shark, unless the mouth of the shark is safer than home,’ Omar recited.”

    So America is dangerous, hazardous and inhospitable, like a shark’s mouth?

    I read that verse as a backhanded insult.

    I was scrolling through some twitter feeds the other day and someone (I forget who) said if Republicans were smart they would make Ilhan Omar the face of the Democratic Party.

    I do think Ocasio-Cortez is kind of bonkers and a hack, but she’s also occasionally witty on twitter and she’s photogenic if captured from the right angle.

    Omar on the other hand is a Somali con artist who seems to have a chip on her shoulder against anyone white or American.

    GOP is barking up the wrong tree.

  201. Anonymous[427] • Disclaimer says:
    @J.Ross

    Patternmaking is more or less a lost art because CAD/CAM and 3D printing have taken over much of the traditional patternmaker’s skills. Things like shrink rules and figuring out draw and gating is mostly done in software.

    Plus which, we have lost a great deal of foundry work due to the EPA and the lack of safety or environmental controls in places like China.

    I was told by someone at Honeywell (avionics, not the bomb plant) that because of ITAR they have to have many boards manufactured in the US. The cost is more than triple what the Chinese charge and it takes twice as long to get a board made and shipped.

    Any business or hobbyist can get boards from China in 3 to 5 days cheaply from Gerber files and QC is generally quite good.

  202. Anonymous[427] • Disclaimer says:
    @anon

    Instead of exporting natural gas or LPG we’d do far, far better to encourage people to run vehicles on the stuff. Much lower infrastructure costs and both LPG and CNG cars are cleaner than gasoline ones, even now.

  203. Dan Hayes says:
    @J.Ross

    J.Ross:

    Risk analysis in action: the US Coast Guard used to be called The Jewish Navy!

Current Commenter
says:

Leave a Reply - Comments are moderated by iSteve, at whim.


 Remember My InformationWhy?
 Email Replies to my Comment
Submitted comments become the property of The Unz Review and may be republished elsewhere at the sole discretion of the latter
Subscribe to This Comment Thread via RSS Subscribe to All Steve Sailer Comments via RSS
PastClassics
The “war hero” candidate buried information about POWs left behind in Vietnam.
Are elite university admissions based on meritocracy and diversity as claimed?
The sources of America’s immigration problems—and a possible solution
The evidence is clear — but often ignored